A promised gift agreement is a legal document that outlines the terms and conditions of a charitable gift that will be made in the future. Charitable organizations often rely on promised gifts as a way to secure long-term financial support and ensure the continuation of their programs and services.
The agreement specifies the type and value of the gift, the donor`s intention to make the gift, and any conditions or restrictions on the use of the gift. It also includes provisions for the donor`s estate, in case of their death before the gift is realized.
Promised gifts can take many forms, including bequests in a will, life insurance policies, charitable trusts, and other planned giving arrangements. These types of gifts are typically larger than outright donations, and often require careful planning and legal advice.
One of the benefits of a promised gift agreement is that it allows donors to make significant contributions to a charity while still retaining control of their assets during their lifetime. For example, a donor may set up a trust that provides income to them and their spouse for life, with the remainder going to the charity upon their death.
In addition to providing long-term financial support, promised gifts can also offer tax benefits to donors. Charitable donations are tax-deductible, and certain types of planned giving arrangements can offer additional tax benefits such as reduced estate taxes.
When considering a promised gift to a charitable organization, it`s important to carefully review the terms of the agreement and seek legal advice to ensure that the gift will be used as intended. Donors should also discuss the impact of the gift on their own financial and estate planning goals.
In conclusion, a promised gift agreement is a valuable tool for donors who want to make a significant contribution to a charitable organization while maintaining control of their assets during their lifetime. The agreement provides a legal framework for the gift, ensures that it will be used as intended, and offers tax benefits to the donor. By considering a promised gift, donors can make a lasting impact on the organizations they support and ensure that their charitable goals are fulfilled.