Trusting in the Community Foundation

One important way that those who give back to the community create a legacy is planned giving, the practice of donors making arrangements for a gift that will benefit a nonprofit organization in the future. Such gifts are charitable contributions, part of a donor’s financial or estate plan, that can be realized in many ways— each providing benefits to meet a donor’s unique circumstances or tax situation. To meet the needs of those who want to plan their philanthropy in this way, the Community Foundation offers expert advice to help individuals, couples and families make the best possible choices. While many choose to make gifts of cash or stock, bequests, or even gifts of real estate, a charitable remainder unitrust can provide unique advantages.

In 2021, Bill and Claire Fahy established a charitable remainder unitrust at the Community Foundation. The Fahys were looking for a tax efficient vehicle that would provide maximum benefits when gifting appreciated assets, while also supporting the community through a future gift.

“We had a number of motivations when it came to starting this unitrust, but the biggest one was that we were trying to set up and secure our legacy,” said Bill. “It gave us the incentive to do something now and set up the trust to establish the legacy, identify the recipients, and take the headaches away.”

Ultimately, a charitable remainder unitrust pays the donor(s) income that reflects the value of the trust’s assets, and that income has the potential to increase over time as the trust grows in value.

Charitable remainder unitrusts also give people the opportunity to help support and donate to nonprofits of their choice. The Fahys wanted to give back to their hometown of Rome and other organizations near to their hearts, so the decision to support local organizations made perfect sense.

Benefits of a Charitable Remainder Unitrust include:

• Receiving income for life, for a term of up to 20 years or life plus a term of up to 20 years
• Avoiding capital gains on the sale of your appreciated assets
• Receiving an immediate charitable income tax deduction for the charitable portion of the trust
• Establishing a future legacy gift to organization(s) of choice

“Claire and I are both involved with the Rome Art and Community Center, and I’m also the president of the Mohawk Valley Bluegrass Association,” Bill explained. “Music and arts are near and dear to us and as long-time members of the Rome community, we wanted to see that our donations stayed local. We identified some local arts organizations and other service organizations that we wanted to support for the long haul and ones that held meaning in our lives.”

In addition to supporting Rome organizations, Bill also explained that he and his family are strong supporters of the Central Association for the Blind and Visually Impaired (CABVI).

“My brother was born with a vision impairment that left him blind, and he had been working at CABVI for years,” he said. “The support they’ve given him and our family over the years is a main reason as to why we wanted to support their organization and give to them through our unitrust.”

Setting up a charitable remainder unitrust does not have to be a long and complex process. Staff at the Community Foundation are here to help you and your tax advisors along the way, as Bill and Claire came to find out.

“It was a team effort with us,” he said. “Claire was involved every step of the way with me as we started setting up our trust. I would definitely start with the Community Foundation and talk to Nick Grimmer. There is a lot of planning that goes into setting one up, but Nick and everyone else at the office worked together in a way that made me realize that I was in good hands and that the trust would be set up the right way.”