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Old 11-05-2013, 08:52 AM   #21
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In looking over the Vanguard and Fidelity Charitable Trust websites I give Fidelity's site the edge. They both made it clear that they were not part of the investment firm.

It was easier for me to use Fidelity's site and they allow a $50 gift versus the $500 minimum at Vanguard. The Fidelity's site let's you open an account with $5,000 and Vanguard requires $25,000. It wasn't clear to me if Vanguard required that as a minimum account balance. Otherwise, the fees are the same. I didn't look at investment options. The principal charities I give to are all in their systems but I didn't expect that to be an issue.
Thanks for summarizing (and for others' inputs as well). I know Nords has done similar things in the past but good to know how things stand currently.
If you evaluate other custodians , e.g. Schwab, your side-by-side comparison would be greatly appreciated.
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Old 11-05-2013, 12:16 PM   #22
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The principal charities I give to are all in their systems but I didn't expect that to be an issue.
They normally will process anything that qualifies as a charity, even if it is not in their system. It might take a little time for them to verify the charity. In the case of VG, they give you a field to enter in the EIN for the charity so they can match it up in the IRS records. I normally make sure I have the EIN from the organization to which we plan to make a grant so it gets processed without delay. I'm sure Fidelity has similar processes.
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Old 11-05-2013, 12:24 PM   #23
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I use Fidelity Charitable Trust and I have been very happy with it.
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Old 11-09-2013, 06:58 PM   #24
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I find myself about to receive a windfall that will be taxed as ordinary income. This will push my tax rate up and most of the windfall will be taxed at the 28 or 33% rate.
Well, the first advice would be to consult a CPA about this-- even if it's for a free hour.

One question you could ask them would be a very dumb one: you're sure it's taxable, right? For example, if it's an inheritance bequest or a life insurance beneficiary payment then it would not be taxable.

Then you could ask them: even assuming that it really is taxable, do you have to take it? I'm not sure whether you can disclaim a windfall (like you could an inheritance) and pass it on to some lucky contingency "beneficiary". Another option might be to tell the payer to send it to your favorite charity instead of to you. That way the entire amount goes to your charity (as far as you can tell) instead of having to be processed through you and the U.S. Treasury. The CPA would be able to advise you on whether it's still considered phantom income.

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[*]Does anyone see any problems with using Vanguard's Charitable Trust to write individual donations to charities? I have multiple charities that I donate to.
Don't know anything about Vanguard, but CGFs are fairly standard institutions these days. Even Vanguard with its rock-bottom bare-bones customer service should be able to handle it as well as they handle their other customer-service challenges.

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[*]Does anyone have another charitable trust platform they would recommend?
I'm with Fidelity by default (four generations of Ohana Nords funds there) and it's great. Lots of features, lots of choices. You can also confirm that your charities are part of their database, or could be added. The best part of a charitable gift fund is that you can make the grants anonymously. You'll never get another donation letter in your mailbox-- unless you want one.

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[*]Does anyone see any problems taking a large charitable deduction in one year to do this?
Another question for your CPA. Although they're limited by your income (as previously noted), you may be able to roll the unused deduction forward like a capital loss. I don't know because I've never made that large a charitable deduction.

Another option would be to boost your taxable income by harvesting capital gains (from your other investments or an IRA conversion) and then making the large charitable deduction up to the 50%/30% limit.

I don't think the IRS cares as long as the 1099s and the other computer-generated paperwork matches up. Of course boosting your income may also trigger other taxes like AMT, so you'd want to seek professional help on your tax return.

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[*]Could I donate appreciated after-tax assets to this trust effectively eliminating future LT capital gains but taking the charitable donation on the appreciated amount?
I can't speak for Vanguard, but Fidelity's charitable gift fund works straight from the tax code. You can donate appreciated shares of stock or other valuables like real estate or art (for which an appraisal might be required). I was not able to have royalty checks donated directly to the CGF, but the staff said that's because the tax code didn't permit it. If the tax code changes then the CGF will probably change their policy to suit.

Another huge advantage of a CGF is that it decouples your donations and your grants. You're able to make a gargantuan donation this year (because you want to) but you can continue to parcel out your grants to your charities over whatever annual schedule you prefer. The CGF only cares that you meet the IRS requirement of disbursing a long-term average of at least 5% of the amount in the CGF each year, just like any other charity. I think the Fidelity CGF actually tracks the long-term average for you over a three-year or five-year period and tells you when you fall short.

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[*]Would anyone like to suggest another way to reduce the taxable income besides a charitable trust?
Getting back to that CPA... they may be able to show you a way to set up a charitable remainder trust so that you don't pay taxes on the windfall but only pay taxes on the income that you receive from it. But this is way beyond my knowledge of the tax rules.
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Old 11-09-2013, 07:56 PM   #25
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Another huge advantage of a CGF is that it decouples your donations and your grants. You're able to make a gargantuan donation this year (because you want to) but you can continue to parcel out your grants to your charities over whatever annual schedule you prefer. The CGF only cares that you meet the IRS requirement of disbursing a long-term average of at least 5% of the amount in the CGF each year, just like any other charity. I think the Fidelity CGF actually tracks the long-term average for you over a three-year or five-year period and tells you when you fall short.
When I opened my account with Vanguard Charitable a few years ago when I had a blip up in income/tax brackets, I asked the Vanguard Charitable people about this 'requirement'. I was told that the only mandate is that the overall Vanguard Charitable organization as a whole has to meet the 5% minimum....and this makes sense, because you don't technically/legally 'own' the funds anymore, the entire Charitable fund does as a whole.

Because VC, as a whole, distributes some huge % of assets each year (like 20%+), they easily meet this IRS requirement. The only stipulation VC makes on each account holder is that they make at least 1 'grant recommendation' every 7 years ($500 minimum).

I haven't compared them lately, but VC has increased the number of investment offerings available, as well as slightly decreased the annual expenses. The web interface may not be as intuitive or as great as some other sites, but I only need to move around it maybe once or twice a year (I log in more often to see the balances, but only need to really use the site less frequently). The rock bottom vanguard fund options make up for the slight hassle of the website. And since I don't give to 100 different charities, the minimum donation isn't as much of an issue for me.
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Old 11-09-2013, 08:48 PM   #26
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I've used the Vanguard fund for a decade and have had a very good experience - very fast on the documentation, good website, easy to use, easy to be either anonymous or named, good customer service if any problems (I mislaid the tax documentation and they replaced immediately after an overnight email).
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Old 11-28-2013, 07:52 AM   #27
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We opened a Fidelity Charitable giving (donor-advised) account yesterday.

We are itemizing deductions for 2013, so this was a good year to do a little extra gifting.

Thanks to all for all the good posts and advice over the years. I found lots of informative posts going pretty far back by searching on "Charitable".
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