Legacy giving: A conversation that’s full of opportunity

August is National Make-A-Will Month, and you may be reading articles and hearing about estate planning more this month than usual, which makes the next few weeks an especially good time to review your estate plans–or get your wills and trusts in order if you haven’t done so yet.

Charitable giving is an important part of any estate planning conversation. Certainly, bold, legacy-making plans are frequently in the news because of the high-profile people who establish them, but you too, and nearly anyone, really, can leave a legacy to support favorite charitable causes.

Here’s a primer about leaving a legacy:

Q: What is a legacy gift to a charity?

A: Think of a charitable legacy as a post-life gift that you structure in advance. Legacy gifts are often referred to as planned giving.

Q: What assets can be used to make a legacy gift? 

A: Like the gifts to charity that you are already making during your lifetime, cash, stock (especially highly-appreciated stock), real estate, life insurance, an IRA beneficiary designation (which is extremely tax effective), are examples of assets that can be the subject of a legacy gift. A legacy gift can be expressed in your estate planning documents as a dollar amount, percentage of the whole, or a legacy gift of the assets themselves. You will want to choose assets carefully, enlisting the expertise of your financial planner or attorney to do so.

Q: How is a legacy gift actually made? 

A: Legacy gifts are typically spelled out in detail in your will or trust documents. This is especially important because after you are gone, too much is otherwise potentially subject to hearsay or conflict. To attorneys, accountants, and financial advisors, this is common sense, but a surprising 2 out of 3 Americans have no estate planning documents.

Q: What are some particulars to be aware of?

A: Most legacy gifts can be revoked or altered through beneficiary or will changes during your lifetime. This is an important feature, as you can include charitable giving in your estate plans but still be flexible as your overall family and financial picture changes over the years.

Q: What tools does the community foundation offer to help?

A: A particularly useful technique is to establish a fund at the community foundation that spells out the your wishes for charitable distributions to specific organizations. Your estate planning documents can, in turn, simply name the fund as the beneficiary of charitable bequests. You can adjust the terms of the fund anytime during your lifetime to reflect evolving charitable priorities.

Want to know more details about Estate Planning in Montana check out our webinar with Marsha Geotting.

Learn more about how your legacy could establish a fund at the Community Foundation or how we could help fund the organizations you are most passionate about. Call us (406)926-2846 to set up an appointment.

*Please note that The Community Foundation does not render tax or legal advice. We ask that you consult with your professional advisor about your situation before making a charitable gift.

Structure is a critical step in multi-generational philanthropy

picture of family holding hands and walking awayInstilling the idea of charitable giving in children and grandchildren at first blush may appear to be easy, but where to begin, and how to make it ongoing? More and more, wealth advisors are being asked by their clients to weigh in on strategies for fostering a family’s financial values, which frequently include charitable giving traditions.

An important first step in creating any multi-generational philanthropy plan is to consider organizing your charitable giving, such as through a family donor-advised fund at the community foundation.

The process of organizing charitable giving itself creates much-needed clarity around your family’s philanthropic purpose. This is because without an organized approach to family giving, it is easy for children and grandchildren to get confused about their parents’ and grandparents’ processes for making decisions about which nonprofits to support.

Consider this scenario:

"Before we got everything organized through the community foundation, our family seemed to take a shotgun approach to charitable giving," commented the daughter of an entrepreneur who formed a family donor-advised fund upon the sale of a business.

Her mother, the entrepreneur, had underestimated the confusion: "Nearly every check I’d ever written to a charity was aligned with my commitment to supporting a healthy workforce in our community. Without a healthy workforce, my business would never have been successful. Now, though, I see that because I was not involving the rest of my family in my giving and explaining why I was supporting certain causes, it might have looked chaotic to them."

Establishing a fund at the community foundation can be a very effective solution for many donors who are looking to launch a multi-generational giving strategy. Here’s why:

  • Community foundation vehicles are extremely flexible and can be used to engage an extended family in the process of charitable giving. Donor-advised funds, for example, are popular because they allow the donor to name children and grandchildren as successor advisors.
  • When charitable giving is organized through a community foundation fund, the donor can make a large transfer of cash or marketable securities that is immediately eligible for a charitable deduction. Donors can recommend gifts to favorite charities from the fund when the time is right. This is especially useful in the case of those who sell a business or experience a large influx of taxable income in a single tax year.
  • Establishing a donor-advised fund at the community foundation can be a great choice for family-oriented donors. That’s because, at a community foundation, donors, as well as their children and grandchildren, are part of a community of giving and have opportunities to collaborate with other donors who share similar interests.
  • The community foundation can work with a family on a charitable giving plan that extends for multiple future generations. That is because the experienced team at the community foundation supports strategic grant making, family philanthropy, and opportunities to gain deep knowledge about local issues and nonprofits making a difference
  • Finally, the community foundation’s tools and resources make it much easier for families to communicate across generations about the family’s charitable giving purpose and goals for long-term impact.

We welcome the opportunity to work with you  to establish an enduring and rewarding family philanthropy program that is customized to meet your family's unique goals and interests.


Giving After 70 and The Secure Act

Giving After 70 and How The Secure Act Has Changed That

In late December 2022 the Consolidated Appropriation Act of 2023 was signed into law. The Missoula Community Foundation has been watching this legislation carefully because it has the potential to incentivize giving to Missoula area charities – most notably by providing tax benefits and disbursing taxable income for seniors. The Secure Act of 2022, housed in this legislation, enhances and expands the ways in which seniors can use their retirement assets to make charitable gifts. 

So here is the lowdown on the changes and a few articles we have been reading. The IRA Charitable Rollover, passed in 2006, allows taxpayers age 70½ or older to transfer up to $100,000 annually from their IRA directly to a public charity without first having to recognize the distribution as income. These transfers from an IRA to a charity are called Qualified Charitable Distributions or QCDs. 

One of the enhancements in the new legislation is that IRA holders 70½ or older are allowed to make a one time distribution to a charitable gift annuity or a CRUT. This distribution will count towards the IRA holders Required Minimum Distributions (RMD) if you are 73 or older and can help spread that taxable income over subsequent years. 

Marcy Allen, our Executive Director, met Sally Scheafer at a planned giving workshop last fall. Scheafer has been a key player in developing and moving this legislation forward, and her recent article (co-authored by Emily Horiwitz from the American Heart Association who took the lead in organizing charitable organizations to support the legislation) has some great highlights on how seniors and charities can benefit from the changes. The new legislation also indexes the existing IRA Charitable Rollover amount (currently at $100,000) starting in 2024. This will be the first inflationary increase since the legislation was passed in 2006.

As with any new legislation, there are often many questions about how it will work in real life. This recent legal analysis might be of interest to professional service providers, especially with regard to the new “Legacy IRA” provisions allowing eligible taxpayers to make a one-time QCD to a charitable remainder trust or charitable gift annuity.  

The team at the community foundation is a resource and sounding board for both donors and professional service providers. We understand the charitable side of the equation and are happy to serve as a secondary source. This post is for informational purposes only. It is not intended as legal, accounting, or financial planning advice.  

New Board Members 2023

Missoula Community Foundation Elects New Board Members:

Julie Osborn & Ben Sokoloski

February 2, 2023

The Missoula Community Foundation Board, together with Executive Director Marcy Allen, is pleased to announce that Julie Osborn and Ben Sokoloski have been elected to serve a three year term on the foundation board.

Julie Osborn is the co-founder of Ecology Project International and has worked in a leadership or volunteer capacity for many area nonprofits, including Families for a Livable Climate, Home Resource, Missoula Symphony and Missoula International School. She is a long-time Missoulian and enjoys applying her experience in nonprofit, political, educational and research organizations to bring together inclusive communities and support innovative programs. She is especially passionate about working with diverse groups to address climate change and environmental equity issues.

Julie was most recently the Finance Manager for Monica Tranel’s campaign, and was a member of the Missoula Community Foundation’s MPNE Advisory Committee.

Ben Sokolosi is a Missoula native with a background in finance real estate and asset management. Backed by his experience with private equity and entrepreneurship – and inspired by the John Ruffatto Business Startup Challenge at the University of Montana – Ben launched, ran and grew the downtown gem Market on Front. In 2019 Ben sold the company to a local entrepreneur and embarked on a new journey in the insurance world.  He joined Stewart Title to develop, strategically reposition and improve systems/efficiencies and most importantly position the company for acquisition, which was carried out in 2021. Ben is currently Area Manager for Fidelity National Title in Missoula and Ravalli Counties.