How You Can Give - Common Planned Giving Vehicles

Will/Trust
Charitable Gift Annuity
Pooled Income Fund
Remainder Trust
Lead Trust
Life Estate

Will/Trust
The most common vehicle chosen by individuals to transfer assets to others after their lifetimes is either a will or a trust, often called a living trust. The will is the most simple to create, but after death, it is subject to a legal process called probate, which is public and may delay the transfer for a long period of time. Today, many individuals choose to hold all their assets in a living trust of which they and their spouses are trustees. While more complicated to establish, the asset transfer is immediate.

In their will or trust, individuals will indicate that The Foundation will receive a certain amount, a percentage of or the residue of the estate.

Charitable Gift Annuity
A Charitable Gift Annuity (CGA) can generate immediate or deferred income for the life of one or two designated individuals, can provide a partially tax-free income and an income tax deduction for the donor, and allows the remaining assets to be used to support your favorite charities and/or charitable causes.

The San Diego Foundation is licensed by the State of California, Department of Insurance to offer Charitable Gift Annuities. We offer both immediate CGAs to individuals 55 and over and flexible CGAs to individuals 45 and over. The minimum contribution to a Charitable Gift Annuity is $25,000.

Pooled Income Fund
The Pooled Income Fund is similar to the Charitable Remainder Trust (assets irrevocably given in trust; donor receives lifetime income, tax deduction, bypass of capital gains). Contributions from all donors are managed in a pool. The donor does not choose the payout percentage, but receives her/his prorated share of the pool earnings.

City National Bank is the trustee for The Foundation's Pooled Income Fund. Donors to other charities may use the Fund to benefit the charity of their choice at no charge to the charity during the donor's lifetime.

Remainder Trust
This approved IRS vehicle permits an individual to irrevocably place assets in trust and from their investment, receive an income for life or a period of years not to exceed 20. In addition to the income, the individual also receives an income tax charitable deduction and an elimination of any capital gain taxes. The individual chooses the trustee (who will manage and distribute the assets in the trust) and with some limitations, the percentage amount that the trust will annually pay. After the term (lifetime or number of years), The Foundation receives the assets in the trust.

The donor's deduction is the value of The Foundation's interest on the day of the gift (present value of the remainder interest). While the donor may establish the trust with $1M, for example, the donor maintains the right to receive income from that trust. The Foundation receives nothing until the completion of the term. While The Foundation does not act as trustee, it will facilitate the donor's choice of one.

There are 2 types of Remainder Trusts:

• Unitrust (referred to as CRUT - Charitable Remainder Unitrust)
  This is the most popular. The percentage initially selected for payout will never change, but because the trust is valued annually, will increase/ decrease with inflation. Additions may be made at any time.
  
• Annuity Trust (referred to as CRAT - Charitable Remainder Annuity Trust)
  The payout amount based on the percentage initially selected will never change. Additions are not permitted.

Lead Trust
This IRS approved vehicle permits one to irrevocably place assets in a trust that distributes to The Foundation for a period of years. The most common reason for selecting this trust, in addition to providing assets to The Foundation immediately, is to reduce or even eliminate estate and gift taxes.

The Foundation currently receives annual distributions from 3 lead trusts. In one instance, the distribution is a contribution to an advised fund.


Life Estate
An individual may deed his/her personal residence to The Foundation, continue to live there and also receive an income tax charitable deduction. The donor enters an agreement with The Foundation stating that The Foundation will not assume the property while the donor lives and that the donor will continue to maintain the property (pay taxes, insurance, etc.).

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