In Turbulent Times, Lessons from the Past Can Help Chart a Course Forward
In times of uncertainty, donors may be inclined to reconsider, postpone, or even suspend their charitable giving. From the donor’s perspective, this is a rational and reasonable reaction because charitable giving is optional and voluntary. However, charitable giving also becomes even more crucial during these times as the demands on charitable organizations increase.
Successful charitable organizations will chart a course to maintain donor relationships through this period of uncertainty, even when donors delay or suspend their giving. We believe planned giving, especially revocable testamentary gifts, can provide an avenue to maintain and even expand donor engagement during these difficult times.
Top Ten Estate Settlement Problems and What to Do About Them
No matter the size of the charity and no matter the size of the bequest, sometimes the receipt of a bequest does not “go smoothly." Andrew Fussner’s team at the American Heart Association handles roughly 800 new estates every year, about 10% of which have some sort of “problem.” Andrew will draw on his vast experience handling estate gifts to discuss ten common estate settlement problems. He will identify each problem and then describe what you can do to resolve it or avoid it in the first place so that your organization receives the funds your donor intended in a timely manner.
Quick Tip: It’s Easy to Change Colors in PGM Anywhere Diagrams
From the Blog: Are You Misvaluing Gifts of Appreciated Securities?
Present Value of Projected Amounts Added to PGM Anywhere
Time to Think about QCDs to Satisfy RMDs
Stop the Pain and End the Suffering – Make This Your Last Year for PIF K-1s
Upcoming PG Calc Online Software Trainings
Help Advance the Planned Giving Profession by Completing the ACGA Gift Annuity Survey
Case Western Reserve University Values PG Calc’s Expertise with Complicated Gifts
Quick Tip: It’s Easy to Change Colors in PGM Anywhere Diagrams:
Many of our clients like to customize the icons and arrows in their PGM Anywhere diagrams to reflect their organization’s colors. It is easy to do!
1. Choose Customize > Organizations and edit your organization.
2. Click the General title bar to open the General section.
3. Enter the hex code for the color of arrows and the hex code for the color of icons, such as the #babcbe and #de5900 pictured below. Your marketing staff should be able to provide you with these values. Alternatively, click the color-picker icon to the right of the field to pick the color with your mouse or enter the RGB values for it.
4. Click Save.
Choosing colors for these diagram elements that coordinate with your logo’s colors may be especially appealing if you include your organization’s logo in diagrams.
Contact Client Services at support@pgcalc.com or at 888-474-2252 if you need help.
From the Blog: Are You Misvaluing Gifts of Appreciated Securities?
“What’s the value of my contribution?” When the question arises, my instant response is, “Why, it’s the fair market value, of course.” If pressed, I’ll cite the IRS definition of fair market value (FMV): “The price that would be agreed on between a willing buyer and a willing seller, with neither being required to act, and both having reasonable knowledge of the relevant facts.”
As straightforward as the rules are, there are situations where it becomes tempting to use the net proceeds from the sale of the stock instead of FMV. But this would be wrong.
Present Value of Projected Amounts Added to PGM Anywhere
On March 14, we updated PGM Anywhere, adding the ability to compute the present value of projected amounts. This new capability enables you to estimate the value in today’s dollars of amounts that will be received in the future.
For example, you can compute the present value of the projected amount a charitable remainder unitrust will provide to your charity when it terminates. Similarly, you can compute the net present value of the income stream a charitable remainder unitrust is projected to distribute to its income beneficiaries during its term.
To compute the present value of projected amounts, open the Date – Lives – Term window and set “Show present values for projected amounts” = Yes, then enter the present value rate you want to use. The default present value rate is the IRS discount rate you’ve selected, but you should enter whatever present value rate you feel is appropriate.
Click the “release notes” link on the PGM Anywhere login screen to learn more about all the enhancements found in the March 14 release.
Contact support@pgcalc.com or call us at 888-474-2252 if you have questions or need help.
Time to Think about QCDs to Satisfy RMDs
For your donors who are age 73 or over, annual tax filing season can turn into a reckoning with how they’ve managed their required minimum distribution (RMD) from their retirement plan.
If a qualifying retirement plan owner fails to withdraw the full amount of their RMD, the amount not withdrawn may be subject to an excise tax of 25%. However, a donor who corrects their misstep within two years by withdrawing the full amount will see that excise tax drop to 10%.
A great way to rectify the issue of not withdrawing the complete RMD from a traditional IRA is to use a qualified charitable distribution (QCD) to support charity. A donor may make an RMD correction with a QCD outright gift, or if they haven’t established a QCD charitable gift annuity (CGA) in the past, they may establish a CGA. They can also give some combination of the two.
A QCD is also a great way to manage the RMD going forward so that the following tax year is less fraught for your donor. This is a particularly helpful technique for donors who learn their RMD has pushed them into a higher bracket for Medicare B and D premiums.
With these financial issues fresh in their mind from April filing, May is an excellent time to market the charitable and tax planning benefits of QCD gifts to donors who are in the appropriate age range. Whether outright or as a life income gift, the QCD will benefit the donor by keeping them compliant with RMD without raising their income in ways that may cause discomfort.
If you would like help developing messaging or collateral to help market the QCD option or any other aspect of your planned giving program, email us or call 888-497-4970 to learn how PG Calc's Marketing Services can help.
Stop the Pain and End the Suffering – Make This Your Last Year for PIF K-1s
If your organization has a Pooled Income Fund (PIF) that’s been around for 30 or 40 years, you may be dealing with a languishing charitable gift vehicle that no one is interested in anymore. Certainly, there are still a number of strong and thriving PIFs, but nowadays, those are the exceptions. The carrying costs for PIFs can become unreasonable as the corpus erodes, and the worst part is waiting – every year – for the PIF K-1s to be sent to the participants.
Believe it or not, some of us at PG Calc have been working with PIFs for 30 or 40 years! Over time, we’ve developed a pretty good sense for when a PIF still has potential, and when a PIF should be put out of its misery. The sponsoring charitable organization can effectively close a PIF when all of the remaining participants have agreed – irrevocably – to relinquish their life income interests.
If you would like to discuss the status of your Pooled Income Fund with someone at PG Calc, please call us toll-free at 888-474-2252 or email us at support@pgcalc.com. Each PIF situation is unique, and PG Calc may have insight and suggestions that we can share with you.
Upcoming PG Calc Online Software Trainings
Register now for our upcoming training sessions! Expand your gift administration knowledge and build your confidence as a gift planning professional.
GiftWrap Advanced, April 30 & May 1 (4 hours over 2 days)
Computing FASB Liabilities with GiftWrap, May 8 (90 minutes)
Planned Giving by the Numbers, June 10 & 11 (6 hours over 2 days)
Help Advance the Planned Giving Profession by Completing the ACGA Gift Annuity Survey
The gift annuity surveys conducted by the American Council on Gift Annuities (ACGA) are the best source of information about charitable gift annuity policies, practices, and trends and are only collected once every four years. Data on gift annuities are not collected by the Internal Revenue Service, and the states that regulate charitable annuities do not have a central repository for gift annuity data. This makes the ACGA surveys invaluable to everyone in planned giving.
The ACGA ensures that responses will remain private and confidential. As you complete the survey for your organization, it will be helpful to have information about annuity activity from your most recent fiscal year at hand. You can download a PDF copy of the survey to prepare your answers before you complete the survey online. You can also exit and re-enter the survey as needed.
The latest ACGA survey opened on April 1, and you should have received an email from the ACGA with your unique link to complete the survey. The ACGA provides a valuable service in suggesting maximum annuity payout rates so that charities can grow their annuity program with confidence that the program will be actuarially sound and beneficial both for the donor and for the organization. Thank you for doing your part by providing your input that can help guide future policies and practices that ultimately help the philanthropic community.
If you have any questions about the survey or need help accessing your unique survey link, you can contact the ACGA at acga@acga-web.org.
Case Western Reserve University Values PG Calc’s Expertise with Complicated Gifts
“The knowledge and expertise of the PG Calc staff has proved invaluable on numerous occasions. Recently, I had a Canadian tax question related to a life income gift. Not only was Kara Morin able to provide me with the answer quickly and efficiently, she also provided me with source documentation to support her conclusion. I am grateful to have this expertise so readily available!”
Amanda Pinney Assistant Vice President, Strategic Giving Case Western Reserve University
