Charitable Giving and Endowments Flashcards
What is the deduction limitation for cash to a private foundation?
30%
What is the deduction limitation and rules for Long Term Capital Gain property to a public charity?
30%.
FMV unless election is made to deduct basis up to 50% of AGI.
What is the deduction limitation and rule for tangible property to a private foundation?
20% basis
What is the deduction limitation and rule for Long Term Capital Gain property to a private foundation?
20%.
Basis unless qualified appreciated stock then FMV.
What is the deduction limitation and rule for Short Term Capital Gain property to a private foundation?
30% Basis
What is the deduction limitation and rule for Short Term Capital Gain property to a public charity?
50% basis
What is the carry-forward for charitable contributions in excess charitable contributions?
5 years.
What is the maximum term for a CRT?
20 years
Who pays the income tax on a CLT?
for a Grantor CLT - the Grantor
for a non-Grantor CLT - the trust pays the income tax and the Grantor does not get a deduction.
What is the maximum term for a CLT?
No max term
What is the minimum payout for a CRT?
5%
What is the maximum payout for a CRT?
50%
What is the maximum payout for a CRT?
50%
What percent of the initial trust value must be left as a remainder interest for the charity?
10%
Which Charitable Trust is tax exempt?
CRT
What is the four-tier system for the income tax character of the distributions made from a CRT?
- Ordinary income.
- Capital gains.
- Other income.
- Distribution of principal.
Which strategy is intended to provide a hedge against inflation?
CRUT
Which Trust provides the opportunity for the non-charitable beneficiary to be paid the lesser of the trust’s net accounting income or a fixed percentage of the value of the trust without a make-up provision?
NICRUT
what are characteristics of a NIMCRUT
- If there is a short-fall of annual income based on the fixed percentage expectation the shortfall is to be made up in the future.
- The Trust pays the lower of the unitrust amount or the trust accounting income.
- When the income exceeds the unitrust amount the income is made up.
What is a Flip CRUT?
Begins as a NICRUT or NIMCRUT and converts to a standard CRUT on a triggering event.
The unitrust percentage is the same before and after the flip
The triggering event is a “specific date or event whose occurrence is not discretionary or within the control of, the trustees or any other person”
What are the tax ramifications of UBTI?
- UBTI may result in double taxation (i.e., UBTI may be taxed to the plan or charitable organization and also to the plan participants or beneficiaries)
- UBTI could be subject to both state and federal taxation
Who (what) is typically impacted by UBTI?
UBTI is most commonly associated with activities within retirement funds/plans or charitable organizations or structures
Are there excise taxes levied on net investment income in a private foundation?
Yes
What are the tax ramifications for gifted assets with unrealized gains?
Gains are not taxed to donor if conditions are met
What are the tax ramifications for gifted assets with unrealized losses?
For gift property worth less than the donor’s basis, the deduction is limited to fair market value
In that instance, it is usually more advantageous to sell property with unrealized losses before gifting thus securing the benefit of the capital loss, and then give cash to charity
What are the tax ramifications for gifted assets that are leveraged
Gain scenario: donor deducts fair market value of the appreciated asset at the date of gift minus debt, subject to deduction limitations
