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No one wants nearly 50 percent of his or her estate to wind up in the taxman’s hands. Yet that’s a very real potential pitfall—one that could be easily avoided through using planned giving vehicles, says Cynthia Beamish, director of estate and gift planning for the University of Miami.

“Planned giving is the name of an industry that helps donors make gifts in a tax-savvy manner,” says Beamish, who’s worked with some of the Miller School’s biggest donors. “A donor’s overall financial condition is taken into account, along with his or her financial goals for the future and for their philanthropic causes.”

Planned gifts, as one might infer from their name, call for more negotiation and planning than outright gifts. Fortunately, the assistance offered by Beamish and her four-person team for gifts made to the University is free.

Most planned giving vehicles deal with future gifts that allow beneficiaries to budget for monies they can expect to receive in the future. Planned giving can be funded using cash, property, or equity, and has three major benefits for donors:
• It reduces capital gains if a gift of appreciated assets is given.
• Assets can be taken out of an estate to reduce the taxable estate.
• Even though a financial gift may be realized in the future, the tax benefit
accrues immediately.

If you don’t use planned giving, your estate may be subject to a 45 percent federal estate tax if it’s worth $2 million or more. However, if tax-wise vehicles are used, the tax hit can be minimized or eliminated.

Types of planned gifts can range from a retained life estate to a bequest in a will. “Anyone can do a will, and you can do it quickly and easily,” Beamish says. “Another great vehicle is a charitable gift annuity, which only involves the donor and the charity.”

Assets that can be designated planned gifts include securities, business interests, life insurance, cash, and even art. And no, you don’t have to be on the Forbes 400 list to create a planned gift.

“Some people might think that planned giving and the advantages that flow from it are only for the wealthy,” Beamish says. “They’re not. Planned giving can even help simplify the probate process, to assist heirs in dealing with probate.”

Potential Miller School donors interested in learning more about the advantages of planned giving can contact Beamish at 305-284-4342 or at cbeamish@miami.edu.