Insights From the Giving USA Numbers and Peering Beyond
Charitable giving totaled $592.5 billion last year according to research conducted by the Lilly School of Philanthropy and published in Giving USA, The Annual Report on Philanthropy for the Year 2024. This is the first annual increase since 2021, when a record $643.8 billion was contributed, and represents a 3.3% increase over 2023 after inflation. Nearly three quarters of all giving was from individuals, including $392.5 billion in current giving and $45.8 in bequests, while giving from foundations was $109.8 billion and corporate giving totaled $44.4 billion.
Beyond the broad totals, the Giving USA report points to some interesting trends . . .
Planned Giving Marketing: What Works, What Doesn't, and What's Next
Are you wondering what strategies truly drive success in planned giving marketing? PG Calc surveyed our clients and colleagues in the planned giving industry about marketing strategies they are currently using: what’s effective, and what’s falling flat. In this session, Andrew Palmer will unveil the survey results, explore best practices, and shed light on what the data tells us about the future of planned giving marketing.
Quick Tip: Calculations for Tangible Property and Collectibles in PGM Anywhere
From the Blog: Flip CRUTs and Deferred Gift Annuities – Know the Difference
Webinar Recording Available: What the One Big Beautiful Bill Act Could Mean for Gift Planning
How AI Can Help Planned Giving – But Be Careful
Charities Can Offer Rates to New York Donors Through at Least December 2025
QCD Gifts Made In-Kind: There’s No Magic
Advanced Gift Planning with PGM Anywhere in Indianapolis
Now Is the Time to Start Marketing Year-End CGAs
Quick Tip: Calculations for Tangible Property and Collectibles in PGM Anywhere
Does a donor want to give your charity their old car or a work of art? Two special rules apply to gifts of tangible personal property and collectibles that don’t apply to other kinds of appreciated property, such as stock and real estate.*
(1) In both cases, the donor’s deduction is based on the value of the donated property only if it is put to a use related to the mission of the receiving charity. Otherwise, the donor’s deduction is based on their cost basis in the property.
(2) A special maximum federal tax rate of 28% applies to capital gain realized when collectibles are sold, instead of the usual 20%.
PGM Anywhere can handle both these special rules. All you need to do is select the right property type and indicate whether the gift will be for a related use.
Open the Gift Options window.
Choose a gift option.
In the gift option follow-up window, set Property type equal to Tangible property (not collectibles) or Collectibles, as appropriate.
Set Will charity put property to a related use? to Yes or No, whichever is correct.
Answer all other questions in the usual way.
PGM Anywhere will compute the charitable deduction based on the value of the property or the donor’s cost basis, as appropriate, and apply the correct capital gains tax rate to realized capital gain, such as the capital gain portion of gift annuity distributions.
* Tangible personal property is any physical asset that can be touched and moved, such as a computer or used car. Collectibles are a sub-category of tangible personal property that can increase in value over time, such as art, antiques, stamps, and coins.
Contact Client Services at support@pgcalc.com or at 888-474-2252 if you need help.
From the Blog: Flip CRUTs and Deferred Gift Annuities – Know the Difference
Clients sometimes ask us how their donor can establish a deferred charitable remainder unitrust (CRUT). The donor would like to transfer the funds now, receive the charitable deduction now, but delay receiving payments until a later date. The presumption is that the CRUT can be structured in such a way that payments will only begin upon a specified date in the future. Unfortunately, in this situation we must say, “No, that cannot be done.”
While the qualified charitable remainder unitrust can be structured in a number of different ways, the deliberate delaying of payments is not allowed. The trust can be written with annual payments, which might allow for as much as a year between the funding date and the first payment, but that is as long as payments can be delayed. And that would mean that all future payments would also be made annually, which may not be appealing to the donor.
If it sounds like the donor should consider funding a deferred charitable gift annuity (DCGA), that is exactly what we would say. But how does the Flip-CRUT compare to a CGA, and how is it different?
Webinar Recording Available: What the One Big Beautiful Bill Act Could Mean for Gift Planning
On July 22, PG Calc President Gary Pforzheimer and Senior Advisor Craig Wruck presented a free webinar explaining the provisions of the new tax law that might affect charitable giving. In addition to presenting the details of these changes, they provided context for understanding how these changes are likely to influence donor behavior. We hope it leaves you better-prepared to answer your donors’ questions about the new tax law and better-equipped to promote planned gifts effectively.
Artificial intelligence (AI) is everywhere now. Do a Google search and there’s the “AI Overview” at the very top of your results. Need to write an appeal letter? More and more fundraisers are turning to Chat GPT and other generative AIs to draft all manner of communications. AI is amazing. It also has its limits. It can get facts quite wrong despite presenting them very convincingly.
Here's an example. After Googling, “How much do I save when I itemize a deduction,” AI Overview included this misinformation in its response: “Itemized deductions reduce your Adjusted Gross Income (AGI), which in turn lowers your taxable income.” Wrong. Itemized deductions do not affect your AGI. They do reduce your taxable income.
AI writes very convincing declarative sentences. As the example above demonstrates, it can also be, quite simply, wrong in what it declares. When it comes to technical information, such as how tax law applies to planned gifts, relying on AI to give you the answer is a risk you would be wise to avoid. You will be better off relying on a published authority. Or contact PG Calc Client Services (support@pgcalc.com or 888-474-2252). We know the answers to a lot of gift planning questions. And if we don’t know the answer, we will tell you and suggest where you can turn to find it.
As Nathan Chappell taught us in his recent PG Calc Webinar, AI rewards the curious to explore the world and become better at synthesizing information. We celebrate that notion and hope AI can help have more donors want to engage in planned giving discussions!
Charities Can Offer ACGA Rates to New York Donors Through at Least December 2025
In early July, New York published updated single-life maximum annuity rates that apply to gift annuities issued to New York residents from July 1, 2025 through December 31, 2025. The updated rates are, in fact, unchanged from the rates that applied during the first half of the year. This means they remain substantially higher than their corresponding ACGA rates at all ages. The same is true for all two-life immediate annuity rates and one-life and two-life deferred annuity rates we have tested. Charities can continue to offer the current ACGA rates to gift annuity and deferred gift annuity donors in New York through December 31, 2025, confident that they will not be exceeding New York’s limits on gift annuity rates.
You can contact our Client Services team at support@pgcalc.com or at 888-474-2252 if you have questions.
QCD Gifts Made In-Kind: There’s No Magic
From time to time, a donor contemplating funding a gift annuity with a qualified charitable distribution from their IRA (a QCD CGA) will ask if they can make the transfer in-kind by sending securities held within the IRA rather than a check. While an in-kind QCD is permissible, the important question to ask your donor is, “Why do you want to do this?” The answer can reveal fundamental misunderstandings about in-kind QCD gifts.
An in-kind transfer occurs when you move securities from one custodian to another. Because the securities are not liquidated, in-kind transfers allow movement of assets without triggering capital gains tax. For instance, you can move securities held in one IRA to another IRA, or from one taxable investment account to another. In-kind transfers made from a donor’s taxable investment account to a charity’s custodial account are also made without triggering capital gains tax, adding to the tax benefits of these types of charitable gifts.
A QCD in-kind transfer can be made via DTC transfer from the donor’s IRA to your charity’s investment account in the same manner as from a donor’s taxable investment account. Your organization can use the same set of transfer instructions for outright and life income stock gifts for in-kind QCDs.
Before delivering the DTC transfer instructions, we advise you to take a moment to ask the donor why they want to make the in-kind distribution rather than having the custodian issue a check. PG Calc’s Client Services team has found that the answer is often one of three common misconceptions: that they must transfer in-kind to avoid tax on the transfer; that an in-kind transfer will make it easier to complete the gift; or that a QCD CGA established with an in-kind transfer will cause some of the annuity to be taxed as capital gain income rather than ordinary income. Let’s unpack these misconceptions in turn.
1. It Is Not Necessary to Transfer a QCD In-Kind to Avoid Capital Gains Tax
If you are dealing with a donor who has made securities gifts in the past, they may believe that the rule for outright securities gifts – that they must be transferred in-kind to avoid capital gains tax – also applies to IRA QCDs.
While a donor can choose this path, it is not necessary. Whether a QCD arrives by check or in-kind, the donor will avoid taxation. The exception is if the distribution is not treated as a QCD. This can happen if all or part of the distribution causes the donor to exceed their annual QCD limit ($108,000 for 2025) or QCD CGA lifetime limit ($54,000 for 2025).
2. In-Kind Is Not Easier for the Donor or the Charity
A donor may believe that an in-kind transfer is easier for your charity to process. They forget that because your charity must wait on the day of gift for the market to close before it can value the securities, the gift may end up higher or lower than the donor intended thanks to market volatility. This is particularly concerning when the donor was already brushing up against the funding limit for their annual QCDs or QCD CGAs described above.
The easiest way to hit a gift target is for the donor to request that their custodian issue a check for a defined gift amount.
3. QCD CGAs Always Produce All Ordinary Income
A donor may have been advised by a confused broker to transfer securities to ensure their QCD CGA will pay capital gain income. Under the legislation that created the QCD CGA, all annuity payments are taxed as ordinary income, whether the QCD arrives at the charity as a bundle of stocks or as a check. There is no particular magic to an in-kind transfer that suddenly produces capital gain income.
On the whole, transferring a QCD gift in-kind to charity is not measurably easier for the donor to make or the charity to process, and confers no extra tax benefit. If your donor does inquire about a gift in-kind QCD, you can accommodate them, but we advise you to check in with them on what they hope an in-kind transfer will accomplish.
Advanced Gift Planning with PGM Anywhere in Indianapolis
Join PG Calc in Indianapolis prior to the Charitable Gift Planners (CGP) conference for PGM Anywhere Advanced on Wednesday, October 15.
This hands-on training will use PGM Anywhere as a laboratory to model advanced gift plans. If you’ve ever wondered how to fund a flip trust with real estate, or whether to propose a non-grantor or grantor lead trust to your donor, this is the class for you. Participants will model charitable remainder trusts, charitable lead trusts and retained life estates.
Now is the time to get a jump on marketing year-end charitable gift annuities (CGAs) to donors. Donors need plenty of time to start planning a CGA, and our BatchCalcs service allows you to provide each of your donors with a personalized, specific calculation in your appeal letters or emails to show the many benefits of a CGA.
With the help of our BatchCalcs service, your mailing can include a gift amount tailored to each prospect, along with the deduction, annuity amount, and tax-free portion they can expect. We can provide you with just the BatchCalcs data or create print-ready letters and/or Summary of Benefits charts for each prospect.
A more personal message is a more persuasive message. Talk to us about how we can make your message more personal by incorporating BatchCalcs into your gift annuity mailings.
