Securities, real estate, or any other property that has risen in value since the donor acquired it. Generally, appreciated property held by the donor for a year or more may be donated at full fair market value with no capital gains cost.
A contractual arrangement to pay a fixed sum of money to an individual at regular intervals. The charitable gift annuity is a gift to Berkeley that secures fixed lifetime payments to the donor and/or another individual.
Gross Income ("AGI")
The sum of an individual’s taxable income for the year is the total at the bottom of the first page of Form 1040. Individuals may deduct charitable cash contributions up to 50% of AGI; they may deduct gifts of appreciated securities and appreciated property up to 30% of AGI.
An assessment of the value of a piece of property. Donors contributing real or tangible personal property (art, books, collectibles, etc.) must secure an independent appraisal of the property to substantiate the value they claim as a charitable deduction.
The benefactor’s purchase price for an asset, possibly adjusted to reflect subsequent costs or depreciation. If Mrs. Bear bought stock for $100 per share and sold it for $175, her cost basis in the stock is $100 per share.
The recipient of a bequest from a will or a distribution from a trust.
A transfer of property or cash to an individual or organization under a will.
Capital Gains Tax
A federal tax on the appreciation in an asset between its purchase and sale prices.
See Basis, above.
A federal tax on the value of the property held by an individual at his or her death (paid by individual's estate, not the heirs or recipients of bequests). In contrast, state inheritance tax is applied to the value of bequests passing to beneficiaries; it is also paid by the estate before the distributions are made.
The person named in a will to administer the estate (known in some states as the "personal representative").
Fair Market Value
The price that an asset would bring on the open market.
In a trust, the right to receive payments from the trust for lifetime or a term of years.
K-1 (also 1099-R)
The IRS forms that we send our life-income gift participants detailing how payments they received from their gifts during the year will be taxed.
Life Income Gift
A planned gift that makes payments to the donor and/or other beneficiaries for life or a term of years, then distributes the remainder to charity.
Securities, artwork, business interests and items of tangible property.
See Executor, above.
A method of supporting charities that enables generous individuals to make larger gifts than they could make from their income. While some planned gifts provide a life-long income to the donor, others use estate and tax planning techniques to provide for charity and other heirs in ways that maximize the gift and/or minimize its impact on the donor's estate.
The land and the structures built on it.
In a trust, the portion of the principal left after the income interest has been paid to the beneficiary(ies). A charitable remainder trust pays income to the donor or other individuals and then passes its remainder to charity.
A legal term for the individual or organization who receives the trust principal after the income interest has been satisfied.
The individual making the will.
A transfer of property by the grantor to the care of an individual or organization, for the benefit of the grantor or others.
An individual or organization carrying out the wishes of the person who established the trust (the "grantor"), such as paying income to the beneficiaries and preserving the principal for ultimate distribution.