Legacy Giving Programs

If a client is leaving money to charity and has an IRA (not uncommon) - one simple move can save a client’s beneficiaries thousands 💴 in future income taxes. We spot it often - a client leaving a small percentage or a lump sum dollar amount to their favorite charity at death as stated in their will or revocable trust. 🤔Two thoughts on that: 1️⃣They may want to instead think about prioritizing making the charitable gifts during lifetime (especially if it can be done as a QCD) because it gets to the same place is was going to end up anyway, while potentially offering lifetime income tax benefits. However, not everyone is ready to relinquish the funds while they still draw air and prefer it to pass at death. So there is Number 2 - 2️⃣To the extent a gift is to be made at death, it could be a good idea to satisfy it by beneficiary designation from pre-tax retirement accounts (to the greatest degree possible). 💡This is because the charity pays no tax on the withdrawal from the pre-tax account, while most individual beneficiaries will realize dollar for dollar taxable income on everything in the account once withdrawn (and usually they only have 10 years to take it out). As you can see from my example of Viserys Targaryen’s estate plan👇- by shifting his 10% of the estate charitable bequest from a ‘One Big Pot’ mindset (i.e. proportionally satisfying the bequest from 10% of each asset) to an ‘Asset-By-Asset’ mindset (where he identifies the best specific asset(s) for each beneficiary to receive based on its tax characteristics) - a total of $143,325 was saved as an after-tax net inheritance amount to be shared by the beneficiaries. 🙋🏻♂️Should the Asset-By-Asset approach only be used when there’s a charity involved? Nope. There can also be circumstances where there are beneficiaries with a wide disparity in income tax rates (federal and/or state) that could warrant taking a similar approach we did here with a charity and applying it to individual beneficiaries. Luckily, I wrote a Kitces article alllll about it. Check it out in the comments! #estateplanning

The 70-year-old donor who's given faithfully for 15 years has never been asked about including you in their will. You're leaving millions on the table. Let me paint you a picture of your biggest missed opportunity: Mrs. Henderson has donated $2,000 every year since 2009. She attends your events, volunteers at your fundraisers, and talks about your organization to her friends. She's 73 years old, has no children, and considers your mission part of her legacy. You've never once mentioned planned giving to her. You're so focused on her annual gift that you've ignored her lifetime gift. You're managing a $2,000 relationship when you could be stewarding a $200,000 opportunity. Meanwhile, Mrs. Henderson is getting planned giving materials from three other nonprofits she supports. They're having conversations about legacy and impact that extend beyond her lifetime. They're positioning themselves as worthy of her most significant gift. You're not even in the conversation. Here's what's tragic: Mrs. Henderson would love to leave a bequest to your organization. She's been waiting for someone to ask her about it. She's been hoping you'd recognize that her faithful giving indicates deeper commitment. But you've never brought it up because planned giving feels "too aggressive" or "too complicated" or "too morbid." Your discomfort with legacy conversations is costing your organization transformational gifts from your most loyal supporters. Stop treating your long-term donors like annual fund prospects. Start treating them like the legacy partners they want to become. Because in fundraising, the gifts that change everything often come from the donors you've known the longest, not the ones you are hoping to meet.

Insights on Long-Term Project Commitments- Exciting update for CSR leaders and NGO heads! The latest India CSR Outlook Report reveals a significant trend: 60% of corporate leadership now favor CSR projects with a duration of 2-3 years or more, highlighting a strong preference for long-term initiatives. This strategic shift reflects a deepening commitment to sustained impact and community development. Here’s a detailed look at the current preferences for project durations: 📆 Up to 1 year: 14% 📆 1 to 3 years: 26% 📆 More than 3 years: A significant 60% The data underscores the sector’s move towards extending project commitments, an approach that promises greater stability and more profound benefits for communities. Why Commit to Long-Term Projects, points to be bookmarked: 1. Deeper Impact: Longer timelines allow for a more substantial and sustainable impact, giving CSR projects enough scope to effect real change. 2. Stronger Relationships: Extended projects foster stronger and more meaningful partnerships with local communities and stakeholders. 3. Enhanced Strategic Alignment: With more time, projects can be better aligned with both corporate strategies and community needs, ensuring mutual benefits. Planning for Longevity in CSR Initiatives, here's how you can do it: 1. Align Projects with Core Business Objectives: Ensure that long-term projects reflect and support your organization's strategic goals. 2. Engage and Involve Stakeholders Regularly: Ongoing communication and active participation from stakeholders are crucial for adapting to community needs and maximizing project outcomes. 3. Design Projects with Flexibility: Incorporate adaptive planning to respond to evolving challenges and opportunities throughout the project lifecycle. As we look to the future, the call for long-term engagements in CSR is clear. How is your organization responding to this trend? 

Every nonprofit leader I speak to sighs when I mention multi year funding. We all know the grind: you land a grant, celebrate for a moment, then rush straight back onto the hamster wheel looking for the next cheque. It is exhausting, and not sustainable. The good news is that multi year funding exists, and more funders are seeing that lasting change needs long term investment. But you cannot pitch it the same way as a one year project. You need to show three things: Purpose, People and Proximity. Purpose: Funders back clarity. Spell out the long term difference your work will make and why their support matters over several years, not just twelve months. People: Demonstrate capacity. Show that your team, systems, and governance can spend and govern resources responsibly and adapt as the work scales. Multi year support is about trust. Donors want to see that you have the right people in place to deliver. Proximity: Bring funders close to the story. Share evidence of strong relationships with communities and partners, and invite funders into that journey. The closer they feel to the impact, the more willing they are to walk with you for the long haul. When you weave these three threads through your proposal, you give funders confidence that their commitment will multiply results over time. Multi year funding stabilises programmes, frees up energy for impact, and deepens relationships on both sides. Think of it like planting an orchard: one year’s grant buys seedlings, but three years of support nurtures trees sturdy enough to bear fruit season after season. 🌱🍊 How are you positioning your organisation for multi year funding?

The nonprofit sector is at a crossroads. Total charitable giving in the U.S. grew 3.5% in 2024 — yet the number of donors dropped by 4.5% (Fundraising Effectiveness Project). This paradox is dangerous. If fewer people are giving, even rising dollar amounts can’t sustain long-term growth. So where’s the opportunity? 👉 Mid-level donors. Often defined as those giving $5,000–$50,000 annually (though the range flexes by organization), mid-level donors are: ✨ Loyal supporters who already believe in your mission. ✨ Financially savvy — many have stock, real estate, or estate planning on their minds. ✨ Hungry for meaningful engagement and smarter giving options. Yet, too often, they fall through the cracks between annual fund and major gifts. Here’s how to change that: 1️⃣ Tailor your stewardship. Recognize them as a distinct segment. Simple, personal touches go a long way. 2️⃣ Offer access + education. Small-group briefings or virtual sessions with leadership can spark deeper commitment. 3️⃣ Provide flexible giving options. Stock gifts, charitable gift annuities, and bequests help them give meaningfully without sacrificing financial security. ✅ When engaged intentionally, mid-level donors give more, give longer, and are more likely to include your nonprofit in their estate plans. They also tend to be more resilient during economic downturns.

The majority of your current donors will be gone within 20 years. That isn’t morbid. It’s demographics. And it should affect how you lead. In one recent donor file review, a client realized that well over half of their most loyal donors were already past traditional retirement age. For years, they had thanked them for annual gifts but had never invited them to consider a legacy gift. Not because they were indifferent, but because they didn’t want to “make anyone uncomfortable.” They "didn't want to talk about death." Here are the facts: - Avoiding legacy conversations doesn’t protect relationships. It simply ensures that many donors will never be asked to make the most meaningful gift of their lives. A thriving legacy giving program is not about pushing complex tax tools. It’s about three simple commitments: - Honor your donors’ stories. Give them space to reflect on what shaped them and how they want to be remembered through their giving. - Normalize the conversation. Talk about bequests, beneficiary designations, and endowments the same way you talk about monthly giving or major gifts, as a natural next step in a generous life. - Protect your mission’s future. Use legacy commitments to build reserves and endowments so the people you serve aren’t at the mercy of next year’s budget or the next downturn. If most of your donors will be gone within two decades, the real question isn’t, “Should we build a legacy program?” It’s: When will your donors hear from you about it? #PlannedGiving #Fundraising #Nonprofits #Endowment #Legacy

Stewarding Your DAF Donors for Long-Term Success Think differently about your DAF donors. They're not just supporters - they're strategic partners in philanthropy. Key Insights: --DAF donors give 20% more annually than traditional donors --They're more likely to maintain giving during economic downturns --85% have already earmarked funds for charitable purposes --Most actively seek long-term philanthropic relationships 🎯 Stewardship Blueprint: Education & Engagement --Share impact stories monthly --Provide program-specific updates --Offer behind-the-scenes insights Recognition & Relationship Building --Create DAF-specific recognition programs --Host exclusive impact briefings --Facilitate peer connections Strategic Communication -Highlight DAF succession planning options -Share tax-smart giving strategies -Demonstrate long-term impact 🎓 PRO TIP: Implement the "DAF Succession Triple Play." When stewarding DAF donors, always discuss three succession scenarios: 1) Immediate family inheritance 2) Specific charitable beneficiaries 3) Hybrid models. Most DAF donors haven't considered these options, and 65% will include charitable beneficiaries once presented with these choices. Create a simple one-pager outlining these options - it's your most powerful planned giving tool for DAF donors. Ready to transform your DAF donor relationships? Let's connect and discuss your strategy. #DonorStewardship #NonprofitStrategy #Fundraising #PhilanthropyTrends

Part 1 of 2: What happens if your nonprofit's fundraising suddenly slows down? That question alone highlights why nonprofit endowments matter. While annual gifts fund today's work, endowments help protect an organization's mission for the future. They create stability, strengthen sustainability, and provide resources that can support generations of impact. Here are five reasons they are so important: 1. They create long-term financial sustainability. Endowments generate ongoing income while preserving principal, helping organizations build a reliable source of support. 2. They provide stability during uncertainty. Economic downturns, funding cuts, and unexpected challenges become easier to navigate with endowment resources in place. 3. They encourage legacy giving. Many donors want their impact to last. Endowments provide a meaningful home for bequests, charitable trusts, retirement assets, and major gifts. 4. They strengthen organizational credibility. A well-managed endowment signals strong stewardship and long-term planning to donors and funders. 5. They support innovation and growth. Predictable income allows nonprofits to invest in new opportunities without relying solely on annual fundraising. For example, a nonprofit with a $5 million endowment and a 4% spending policy could generate approximately $200,000 annually while preserving the principal. Endowments are not just about money. They are about protecting mission, creating stability, and ensuring impact lasts far beyond today. Does your organization have a plan for building long-term financial sustainability?

Charitable giving is a great tax savings strategy implemented by many philanthropists with big pockets. Some of the best methods: 1. Donate appreciated assets directly to charities. If you donate stocks, bonds, real estate, or other long-term appreciated assets (held over a year), you avoid owing capital gains taxes on appreciation and can deduct the full fair market value as a charitable deduction (generally up to 30% of your adjusted gross income). 2. Use donor-advised funds (DAFs). Contribute cash or appreciated assets to a DAF and take an immediate deduction, while retaining flexibility to advise on distributions to charities in future years. The assets can grow tax-free within the fund, and DAFs make “bunching” or multi-year donation strategies easier. 3. Bunch or aggregate multiple years of giving. Concentrate several years’ worth of donations into a single tax year to exceed the standard deduction threshold, allowing you to itemize and maximize deductions in higher-income years, then claim the standard deduction in off years. 4. Make qualified charitable distributions (QCDs) from IRAs (age 70½+). QCDs go directly from your IRA to a charity, counting towards required minimum distributions but not increasing taxable income. These aren't deductions - they lower your adjusted gross income and potentially reduce the taxes paid on Social Security and Medicare premiums. 5. Charitable estate planning. Designate charities as beneficiaries in your will, retirement plans, or trusts, effectively removing those assets from your taxable estate and possibly reducing or eliminating estate taxes. 6. Charitable trusts. For complex or large giving plans, vehicles such as charitable remainder trusts and charitable lead trusts can provide income, generate immediate tax deductions, and ultimately benefit charitable organizations.

There are two things everyone should know about charitable donations—and they can make a huge impact on your financial planning. First, charitable donations can mitigate up to 75% of your net personal taxable income and can be a corporate tax dedcution each year. And if you don’t use the full amount, you can carry forward those credits for up to 5 years. But here’s the game-changer that most people don’t know: Charitable donations on death can eliminate 100% of estate taxes. That’s right. Let’s say you’ve done an estate freeze on a business valued at $50 million. You’re facing a $10 million tax bill. Instead of scrambling for ways to cover that tax, why not use charitable donations as your strategy? Imagine creating a $20 million insurance policy—on a cash-flow-neutral basis—and donating that to charity upon your passing. You’d receive a charitable receipt for the full $20 million, wiping out your $10 million tax liability and leaving your legacy intact. Now, instead of writing a check to the tax department, you’re remembered for your generosity and the lasting impact you made. This is the power of incorporating strategic philanthropy using life insurance into your estate planning. It’s about protecting your wealth, reducing taxes, and ensuring your legacy lives on in the most meaningful way possible. - Follow Mark Halpern CFP, TEP, MFA-P for all things Estate Planning, Life Insurance, Strategic Philanthropy and Tax Mitigation. I’m on a mission to create $1B dollars a year of charity and to help you go from Success to Significance.