Save the Date: 2026 Professional Advisors Symposium
The Evolving Role of the Professional Advisor: Changing Client Expectations
Join San Diego Foundation and fellow professional advisors for an afternoon of insight, strategy and connection as experts across legal, tax, fiduciary and financial disciplines discuss emerging trends in client service, charitable planning and complex assets.
Wednesday, October 7, 2026
12:30 to 5:30 p.m. PT
Farmer & The Seahorse – The Americana Room
San Diego, CA
Two hours of continuing education credit available (MCLE, CFP®, CPE and PFEC). Lunch and parking provided.
Formal invitation to follow.
This month, we’re highlighting a few areas that may be coming up in your client conversations, including charitable assets in divorce, renewed interest in sophisticated planning tools and how recent tax law changes may be shaping planning discussions.
Calling it splits: What happens to charitable assets in a divorce?
Philanthropy is deeply personal, but in a divorce, charitable assets can raise complex legal and financial questions. It’s important to consider how donor-advised funds, trusts and other charitable vehicles may be treated when a marriage ends, and how proactive planning can help avoid surprises.
Rare but useful: Planning with charitable lead trusts
Charitable lead trusts may not come up often, but when they do, they can be powerful. San Diego Foundation (SDF) is sharing why charitable lead trusts (“CLATs”) are getting renewed attention, especially following a recent IRS ruling, and how these vehicles can help certain clients achieve both charitable and estate planning goals.
Wake-up call: OBBA changes and client conversations
You may already be well-versed in recent tax law changes, but many clients are just now starting to pay attention. SDF keeps you up to date on key developments affecting charitable giving and offers practical reminders to help guide your client conversations in a shifting landscape.
As always, San Diego Foundation is here as a resource when charitable giving becomes part of your client conversations.
Calling it splits: What happens to charitable assets in a divorce?
Over time, many advisors help clients establish donor-advised funds (DAFs), structure charitable gifts and incorporate philanthropy into broader planning.
But what happens to charitable assets in the event of divorce? Over the last few years, in the wake of high-profile divorces, more advisors have been pondering this question.
For many couples, philanthropy is deeply personal and closely tied to shared values developed over time. What’s more, advisors who engage both partners on all planning matters, including charitable giving, are more likely, according to research described in a recent white paper, to grow their practices and earn client referrals.
But from a legal standpoint, charitable giving during marriage is not purely personal. It is often subject to the same rules that govern other marital assets.
In community property states, for example, assets acquired during marriage are generally considered jointly owned, and spouses owe fiduciary duties to one another regarding the use of those assets. That framework can create complications when one spouse makes a significant charitable gift without the other’s knowledge or consent. Indeed, unilateral gifts of community property may be challenged, and in some cases, the full value of the gift may be attributed back to the donating spouse in a divorce proceeding. This may be a surprising outcome for clients who assume that charitable intent alone resolves any questions about ownership or control.
The implications extend beyond outright gifts. Philanthropic vehicles such as donor-advised funds, private foundations and charitable trusts can also become points of negotiation in divorce. These structures may no longer be considered part of the marital estate once funded, but questions about control, governance and ongoing advisory privileges can still create tension between spouses.
For attorneys, CPAs and financial advisors, the takeaway is clear: charitable planning does not exist in a vacuum.
Conversations about significant gifts, especially those made during marriage, should include coordination with legal counsel and, where appropriate, documentation of mutual intent. Encouraging clients to align on charitable decisions in advance can help avoid disputes later and preserve both financial and philanthropic goals.
San Diego Foundation can support these discussions, including structuring and administering donor-advised funds and other charitable vehicles when appropriate. Learn more through SDF’s Professional Advisor resources.
Rare but useful: Planning with charitable lead trusts
Charitable lead trusts (CLATs) don’t come up often, but they can be useful in certain planning scenarios. San Diego Foundation can work with you to establish a donor-advised fund or other charitable vehicle as part of a CLAT strategy.
Here are a few key developments:
- The Internal Revenue Service issued Private Letter Ruling 202614004 on April 3, 2026, addressing whether a CLAT can be terminated early by accelerating its remaining payments to charity.
- The ruling involved a CLAT that so significantly outperformed expectations that the trustee proposed distributing all remaining annuity payments in a lump sum to a DAF, and then winding down the trust.
- The IRS concluded that this early termination would not trigger self-dealing penalties, would not be treated as a taxable expenditure and would not result in a termination tax, largely because the payment was made to a qualified public charity and fulfilled the trust’s charitable purpose.
Of course, as with all private letter rulings, PLR 202614004 represents the IRS’s non-precedential interpretation of the tax law and is binding only between the IRS and the specific taxpayer who requested the ruling. Still, private letter rulings are often cited to show the IRS’s probable position.
So why is this seemingly obscure private letter ruling relevant as an indicator of the IRS’s likely position in similar future situations? Here’s why:
- CLATs are generally subject to private foundation rules, including strict prohibitions on self-dealing with “disqualified persons.” In this instance, however, the IRS emphasized that a public charity (including a donor-advised fund sponsor) is not considered a disqualified person for these purposes, allowing the accelerated payment without adverse consequences.
- PLR 202614004 highlights that charitable planning vehicles like CLATs may offer more flexibility than previously assumed, particularly when circumstances change or when a trust significantly outperforms projections. What’s more, the ruling reinforces the importance of understanding how technical rules, such as self-dealing restrictions, apply differently depending on the type of charitable recipient involved.
Charitable lead trusts are extremely complex and can be structured in different ways to achieve a client’s specific tax objectives. Still, as you work with charitably inclined clients, keep an eye out for a scenario that may be well-suited for a charitable lead annuity trust:
- The client, whose net worth is likely to be subject to estate tax, owns rapidly appreciating assets (such as pre-IPO stock).
- The client wants to transfer significant wealth to heirs in a tax-efficient way.
- The client wants to make immediate and meaningful charitable gifts while they are living.
A client like this could establish a CLAT and name a donor-advised fund at San Diego Foundation as the income beneficiary. The CLAT would make fixed annual payments to the donor-advised fund for a term of years. The DAF, in turn, could support the client’s favorite charities via the client’s grant recommendations.
At the end of the trust term, any remaining assets in the CLAT would pass to the client’s children or other heirs, often without triggering additional gift or estate tax, assuming the trust was structured properly and investment performance meets or exceeds IRS assumptions.
For clients who want to enjoy charitable giving during their lifetimes and reduce estate and gift taxes on highly appreciating assets, a CLAT is worth a look.
Wake-up call: OBBA changes and client conversations
You may already be familiar with recent tax law changes, but many clients are just beginning to engage with what they mean. While you’ve been busy reading dozens of articles and evaluating how the changes will impact your clients, many of your clients are just now learning about the changes, especially as issues came to the forefront for them during tax season.
Here are three things to know:
- Mainstream media coverage of charitable planning continues to increase, and clients may have new questions about tools such as donor-advised funds.
- Thoughtful planning is especially important in light of the new floor on itemized charitable deductions. Starting in 2026, to be eligible for a deduction, a client’s qualified deductions must exceed 0.5% of adjusted gross income, essentially raising the threshold at which charitable giving produces a tax benefit. This could make it advantageous for some of your clients to “bunch” charitable contributions through a donor-advised fund, allowing the client to front-load donations into a single tax year to cross the threshold.
- At the same time, under a “cap” provision in the new law, if a client is in the 37% federal income tax bracket, itemized charitable deductions are now capped at the 35% tax rate. In simplified terms, depending on other factors, this means that if a client donates $10,000, the tax break would be $3,500 instead of $3,700. In short, the floor and the cap add extra complexity to helping clients plan their charitable contributions.
- The new tax laws have changed the landscape for not only your clients who itemize deductions but also for those who do not itemize. Non-itemizers are now eligible for an “above the line” deduction of $1,000 for single filers and $2,000 for joint filers. Be aware, however, that the new deduction for non-itemizers does not apply to noncash gifts or gifts to donor-advised funds. Because both noncash gifts and gifts to donor-advised funds are important tax planning tools for many clients, this limitation is worth noting in your discussions.
- Finally, remember that donating appreciated stock held for more than one year is usually more tax-efficient than writing a check. That’s because it allows your client to avoid capital gains tax on the appreciation. What’s more, clients who itemize deductions will be eligible to claim a tax deduction for the full fair market value
Learn More
For more than 50 years, we have worked with an extensive network of wealth advisors, estate planning attorneys, tax planners and other financial advisors to help high-net-worth clients and families achieve financial planning objectives and charitable giving goals while maximizing tax deductions.
If you want to learn more about customizing charitable solutions that match your clients’ needs, contact me at (858) 245-1508 or jrogers@sdfoundation.org.
