This case study illustrates the use of a CRT to defer gain on the sale of a closely held business, with the CRT remainder passing to a DAF.

Russell James is truly a bright light in the charitable world. Not only is he a leading researcher and thinker in the area of charitable giving, but he is one of the most generous. He repeatedly offers the fruits of his efforts to our industry, for free. We are honored to present his book, Visual Planned Giving: An Introduction to the Law & Taxation of Charitable Gift Planning, to our readers.

In his first chapter, Russell emphasizes the complexity of planned giving. He identifies multiple issues that contribute to this complexity, including several different tax regimes, state law, federal law, appraisals, business entities, arcane documentation requirements, and more. However, at its core, planned giving can do two things; it can lower taxes and trade a gift for income. Financial advisors and fundraisers should keep these basic principles in mind when considering what planned giving can accomplish.

Due to the plethora of possibilities for trading a gift for income, the issues quickly become cluttered. A donor seeking to reduce taxes and/or trade a gift for income could utilize a CGA, CRUT, CRAT, Flip-CRUT, NIMCRUT, NICRUT, or PIF. However, the core concepts remain the same. Each one of these vehicles allows a donor to lower taxes and trade a gift for income. The advisor or fundraiser should view these structures as options available to meet the donor's needs. In addition to meeting donors' income needs, planned giving can lower taxes. Lower taxes benefit the client since gifts are cheaper; the advisor, because it provides value to the client while maximizing the assets under management; and charity, because it makes large gifts more affordable.

Fundraisers should have a basic understanding of these gift vehicles. This may seem counterintuitive since outright, cash gifts provide instant value to the charity, while the charity may have to wait many years to fully realize the donor's gift in a planned giving arrangement. However, only a small portion of a donor's assets consists of cash. Fundraisers who shun the complexities of planned giving in favor of cash gifts are asking for money out of the smallest bucket since only a small fraction of assets consist of cash.

Planned giving is also an important tool for the financial advisor. Understanding these issues may help the financial advisor attract high net-worth clients since those clients tend to do the most charitable giving. A variety of planning techniques, such as family foundations, donor advised funds, and CRTs, allow the advisor to continue to manage the funds. Moreover, because these entities are not subject to tax, the advisor has more assets under management than if the donor sold the asset and reinvested the cash.

Mr. James has created a set of 65 videos for his "Complete Charitable Planning Training Series" to help his readers understand Chapter 1 and the entire book.

On May 19, 2025, the Board of ACGA reviewed the assumptions underlying suggested annuity rates for CGAs as part of its ongoing monitoring of the industry and the economy. The organization supports maintaining the current assumed rate of return.

By contributing a partial interest in appreciated rental real estate to a charitable remainder trust and then selling the balance of the property outside of the CRT, the donors increase their income stream for retirement and generate an income tax deduction to offset capital gains taxes on the sale portion. When doing charitable tax planning, remember that it is not an "all or nothing" choice!