Glossary of Planned Giving Terms
Actuarial
As used in planned giving, the factors used to calculate the current value of lifetime payments to individuals or organizations.
Appreciated Property
Securities, artwork, real estate, or any other property that has risen in value since the donor acquired it. Generally, appreciated property held by the donor for a year or more may be donated at full fair market value with no capital gains cost.
Annuity
A contractual arrangement to pay a fixed sum of money at regular intervals.
Adjusted Gross Income (AGI)
The sum of an individual’s taxable income for the year before deductions. Individuals may deduct charitable cash contributions up to 50% of AGI; they may deduct gifts of appreciated securities and appreciated property up to 30% of AGI.
Appraisal
An assessment of the value of a piece of property. Donors contributing real or tangible personal property (art, books, collectibles, etc.) must secure an independent appraisal of the property to substantiate the value claimed as a charitable deduction.
Basis
The donor’s purchase price for an asset, possibly adjusted to reflect subsequent costs or depreciation.
Beneficiary
The recipient of a bequest from a will or a distribution from a trust.
Bequest
A transfer of property to an individual or organization under a will.
Capital Gains Tax
A federal tax on the appreciation of an asset between its purchase and sale prices.
Cost Basis
See Basis, above.
Endowment Fund
The permanently held capital of a non-profit used to support ongoing projects.
Estate Tax
A federal tax on the value of the property held by an individual at his death. (The tax is paid by the estate, not the recipients of the bequests.) In contrast, state inheritance tax is applied to the value of bequests passing to beneficiaries; it is also paid by the estate before the distributions are made.
Executor
The person named in a will to administer the estate, known in some states as the personal representative.
Fair Market Value
The price that an asset would bring on the open market.
Grantor
The individual transferring property into a trust.
Income Interest
In a trust, the right to receive payments from the trust for lifetime or a term of years.
K-1 (also 1099-R)
The IRS forms that Park sends to life-income gift participants, detail how payments they received from their gifts during the year will be taxed.
Life Income Gift
A planned gift that makes payments to the benefactor and/or other beneficiaries for lifetime, then distributes the remainder to Park.
Personal Property
Securities, artwork, and items of tangible property, as opposed to real property, used in planned giving to refer to land and the structures built on it.
Personal Representative
See Executor, above.
Real Property
Land and the permanent structures built on it.
Remainder
In a trust, the portion of the principal left after the income interest has been paid to the beneficiary(ies). A charitable remainder trust pays income to the donor or other individuals and then passes its remainder to Park.
Remainderman
A legal term for the individual or organization that receives the trust principal after the income interest has been satisfied.
Testator
The individual making the will.
Trust
A transfer of property by the grantor to the care of an individual or organization for the benefit of the grantor or others.
Trustee
An individual or organization carrying out the wishes of the person who established the trust, paying income to the beneficiaries and preserving the principal for ultimate distribution.
Main Contact: Roger Seidenman '85
Tel: (410) 339-4146
Fax: (410) 339-4165
e-mail: Roger Seidenman