Planned Giving Glossary

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Adjusted Gross Income (AGI): An individual's total gross income for a given year, minus specific deductions. It's a key figure for calculating the limits of charitable deductions.

 

Annuitant: One who receives annual fixed payments from an annuity

 

Appreciated Property/Assets: Assets such as stocks, real estate, or other investments that have increased in value since they were acquired. Donating these can offer significant tax advantages.

 

Beneficiary: The individual or organization designated to receive assets or benefits from a will, trust, life insurance policy, or retirement plan.

 

Bequest: A gift of money, personal property, or real estate designated to a person or organization in a will or trust. It is the most common form of a planned gift.

 

Codicil: A legal document that amends, rather than replaces, an existing will. It is used to make small changes without creating an entirely new will.

 

Cost Basis: The original value of an asset for tax purposes, usually the purchase price. This is used to determine capital gains or losses when an asset is sold.

 

Estate: All of an individual's property and assets at the time of their death, including real estate, investments, and personal belongings.

 

Estate Tax: A tax levied on the total value of a deceased person's estate before it is distributed to heirs.

 

Executor/Personal Representative: The person or entity named in a will to manage and distribute the person's estate according to the terms of the will.

 

Fair Market Value (FMV): The price an asset would sell for on the open market, agreed upon by a willing buyer and seller, both of whom have reasonable knowledge of the facts.

 

Irrevocable Gift: A gift that cannot be changed, annulled, or taken back by the donor after it has been made.

 

Legacy Gift: A term often used interchangeably with "planned gift," but it specifically refers to gifts made as part of a donor's estate plan, such as through a will.

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Remainder Interest: The portion of a trust's principal that is left after the income interest has been paid out. This remaining amount is then distributed to the charitable beneficiary.

 

Real Property: Land and any permanent structures built on it, as opposed to "personal property," which is movable.

 

Tangible Personal Property: Physical items that can be touched and moved, such as artwork, jewelry, or vehicles.

 

Testator: The individual who makes and signs a will.

Trust: A legal arrangement in which a person (the grantor or trustor) transfers assets to a third party (the trustee) to hold and manage for the benefit of another person or organization (the beneficiary).