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The 4% Withdrawal Rule

August 19, 2011

Outright Gift to Charity

Definition

An outright gift to charity is a gratuitous transfer of property to a charitable organization. Generally, you can donate any type of property (assuming the charity will accept it) at any time and in any manner you wish.

Prerequisites

  • Donations must be made to qualified organizations as designated by the IRS

Key Strengths

  • Provides a federal gift and estate tax deduction
  • Provides a federal income tax deduction to taxpayers who itemize
  • Does not produce a taxable gain when appreciated property is donated

Key Tradeoffs

  • Requires the donor to keep reliable written records of contributions
  • Requires a qualified appraisal of donated property in some cases

Variations from State to State

  • States may have their own laws regarding the deductibility of charitable gifts for state income and death tax purposes

How Is It Implemented?

  • Transfer asset to a qualified charity
  • Keep cancelled checks or bank records, or obtain a written receipt for cash donations; obtain written receipts for donations of property other than money

This material was prepared by Broadridge Investor Communication Solutions, Inc., and does not necessarily represent the views of The Retirement Group or FSC Financial Corp. This information should not be construed as investment advice. Neither the named Representatives nor Broker/Dealer gives tax or legal advice. All information is believed to be from reliable sources; however, we make no representation as to its completeness or accuracy. The publisher is not engaged in rendering legal, accounting or other professional services. If other expert assistance is needed, the reader is advised to engage the services of a competent professional. Please consult your Financial Advisor for further information or call 800-900-5867.

The Retirement Group is not affiliated with nor endorsed by fidelity.com, netbenefits.fidelity.com, hewitt.com, resources.hewitt.com,  access.att.com, ING Retirement, AT&T, Qwest, Chevron, Hughes, Northrop Grumman, Raytheon, ExxonMobil, Glaxosmithkline, Merck, Pfizer, Verizon, Bank of America, Alcatel-Lucent or by your employer. We are an independent financial advisory group that specializes in transition planning and lump sum distribution. Please call our office at 800-900-5867 if you have additional questions or need help in the retirement planning process.

The Retirement Group is a Registered Investment Advisor not affiliated with  FSC Securities and may be reached at www.theretirementgroup.com.

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