Charitable giving shouldn’t happen by accident. Every charitable gift your client(s) make should be planned to ensure it both fits their interests and supports the causes they care about.

Charitable giving shouldn’t happen by accident. Every charitable gift your client(s) make should be planned to ensure it both fits their interests and supports the causes they care about.

The terms “planned gifts” and “planned giving” refer to several gift techniques that typically involve the client retaining a portion of, or an interest in, the asset they are giving to charity. Often, charitable distributions under a will or trust, life insurance and retirement plan beneficiary designations, and other direct — but deferred — gift arrangements are also considered planned gifts.

Planned gift arrangements give your client an opportunity to address a wide array of issues they may be facing and can provide them with many benefits. They can be simple or complex, depending on the unique financial, family and business situation they face. Call our Philanthropic Services department at 313.961.6675 to begin customizing a plan that is right for your client.

Benefits of Planned Gifts

  • An immediate charitable income tax deduction
  • Avoidance or deferral of capital gains taxes if appreciated property is used to fund the gift
  • Retained and possibly increased income to your client or others they care about
  • Possible assistance in asset diversification
  • Support for charity

Almost anyone can make a planned gift. Many planned gifts, such as charitable gift annuities, can be established for relatively small amounts ($10,000 or more). Arrangements such as charitable remainder trusts and charitable lead trusts may require more significant amounts to make the administrative and implementation costs of the gift reasonable. The Community Foundation does not serve as a trustee, but we can work with trustees to fulfill the charitable intentions of the trust.

There are a number of different planned gift options, each of which is useful in certain circumstances. The goal is to find the planned gift that is most advantageous to your client, to all those who are significant to them, and to the causes they support. The Community Foundation’s staff can provide assistance in creating a planned gift that’s right for your client.

Types of Planned Gifts

Your client may wish to make a charitable gift to a fund at the Community Foundation, but also needs to provide a source of income for themselves or others. In this situation, one of several retained income gift techniques may be attractive. These arrangements include:

Charitable Gift Annuity

This is an agreement between your client and the Community Foundation wherein we agree to provide the annuitant (usually the donor) a determined amount for life, in exchange for the gift. Unlike most other retained income arrangements, a gift annuity is not a trust. Rather, it is a contract between the Community Foundation and your client that is secured by our assets. Donors can establish a gift annuity at the Community Foundation for a minimum gift of $10,000 or more.

Charitable Remainder Trust

Charitable remainder trusts are established by the donor and are separate trusts that benefit only your client or their designated beneficiaries — and, ultimately, the charitable causes they care about — through the Community Foundation. There are multiple types of charitable remainder trusts to fit a variety of situations. The two main types are annuity trusts, which pay a set amount to the beneficiary, and unitrusts, which pay a percentage of the annually determined value of the unitrust to the beneficiaries. We can work with you to ensure that the charitable cause your client cares about is ultimately supported by their trust.

Other planned giving arrangements provide current support for charity with a deferred benefit to your client or others, or are deferred gifts that take effect upon their death or with the passage of time.

Charitable Bequest by Will

One of the simplest ways for a donor to provide for their community is to establish or add to a fund at the Community Foundation through a bequest in their will. This is a simple option that allows them to enjoy all of their assets during their lifetime and use them to support their favorite causes after death.


Life insurance makes it possible for virtually everyone to make a meaningful gift. Fully paid policies that are no longer needed for their original purpose can make excellent gifts when given to the Community Foundation. Your client can either designate the Community Foundation as the beneficiary, or can gift the policy during their life and likely receive an immediate income tax deduction.

Retirement Assets

Like life insurance, retirement assets can be easily gifted to the Community Foundation at death. This can be done by changing the beneficiary designation for the retirement asset. In addition, your client can reduce income taxes payable by their family — in addition to saving estate taxes — by giving retirement assets to the Community Foundation. For example, if a client were to give a $100,000 IRA to their children at death and another $100,000 of assets to the Community Foundation, their children would have to pay income taxes on the IRA (in addition to any estate taxes that might be owed). By giving the IRA to the Community Foundation and the other assets to the children, all of the income taxes are avoided on the IRA. This income tax benefit can be important when planning the distribution of your clients’ pension, profit sharing, Section 401(k) and Section 403(b) plans, and IRAs. Special rules apply to making charitable gifts of these assets during life. Please consult with your tax advisor and the Community Foundation about these rules.

Charitable Lead Trust

Similar to a charitable remainder trust, a charitable lead trust is established by your client. The Community Foundation receives the current distributions from the charitable lead trust, with the remainder returning to your client — or more typically being transferred to their family. These arrangements can be very useful in helping a client reduce the gift and estate tax costs of moving assets to their family, and can sometimes be used to generate current income tax deductions.

Remainder Interest in Residence

Under certain circumstances, a client can provide for the transfer of their home to the Community Foundation upon their death and still live in their home. This technique can generate immediate income tax deductions for your client, even though they remain in their home until death.

Choosing to give to the Community Foundation in your will is easy. You should always consult with your legal advisor, but sample language such as the following will help make clear your intentions. “I give __________ to the Community Foundation for Southeast Michigan for the benefit of the _________ Fund.”  The first blank may be filled in with a specific dollar amount, a specific percentage, or the remainder of the estate.  The second blank may be used to name a specific fund the funds should benefit, or you can simply make the gift to the Community Foundation without a specific fund name.

Please call the Philanthropic Services department at the Community Foundation for Southeast Michigan at 313.961.6675 to take advantage of the many opportunities a planned gift can provide your clients and their families.

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