1. Charitable contributions  Qualified organizations Public charity: charitable, religious, education, government  Not: your neighbor who lost his job; not Republicans Private charity: foundation  Must give property Not value of time  Must reduce contribution by value of benefit received Raffle tickets  Paid before end of year Credit cards

2. Amount deductible  Chart on Page 126  Cash 50%: public charity Carryover for five years  Capital gain property: deduct FMV 30%: public charity Carryover for five years Elect 50% limit if use cost instead of FMV

3. Amount deductible  Tangible personal property Related use: deduct FMV  30%: public charity  Carryover for five years  Elect 50% limit if use cost instead of FMV Unrelated use: deduct cost  50%: public charity  Carryover for five years  Ordinary income property: deduct cost  50%  Carryover for five years

4. Substantiation  Must have: a bank record (check) for contribution or documentation from charity  No deduction for: Cash contributions to  Salvation Army  Church? They generally will provide documentation

5. Substantiation  Noncash contributions Over $500: attach Form 8283 including description No deduction for used underwear

6. IRA Contributions  Must be over 70 ½  Can contribute up to $100,000 per person in 2007 Why do this?  Income tax savings RMD AGI limits  Estate tax savings

7. Charitable Trusts  Contribute appreciated property to trust No income tax on capital gain  Receive income for life  Get a charitable deduction for value of remainder interest Value of gift – PV annuity payments Old person: value of remainder is large

8. Charitable Trusts  Donor is happy No tax on gain Charitable deduction for remainder interest Income for life Asset is removed from estate  Charity is happy  Heirs are sad Buy life insurance in ILIT to replace value of asset transferred to charity

9. Trusts  CRAT Pays fixed amount or percentage of initial value to noncharitable benficiary  Must be at least 5%  Similar to a bond Remainder goes to charity  Versus lead trust Value of remainder interest  Must be at least 10% of value of assets transferred to trust

10. Trusts  CRUT Pays fixed amount or percentage of annual value to noncharitable benficiary Must be at least 5% of annual value  Equity interest Remainder goes to charity  Versus lead trust Value of remainder interest Can add assets to a CRUT; not CRAT

11. Pooled income fund  Combined with contributions of other individuals  Donor retains life interest  Receive annual income based on performance of fund Remainder goes to charity Value of remainder interest