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Innovations in Charity

Eureka

Creating Impact that Echoes Throughout Eternity

The Ultimate Goal of Wealth

Well done good and faithful servant.  Jesus Christ explained in the “Story of the Servants” (Matthew 25) the value of representing the Master well and seeking His gain on the vast wealth with which you have been entrusted.

In modern America ~ the world seat of innovation for nearly two centuries ~ the law, tax code, and financial institutions have developed in such a way as to grant great gain to the giver and receiver in a variety of ways – for those who dare to innovate.

These are just a taste of the innovations available to change the course of history with a strategic gift or charitable investment…

(Some are nothing less than a EUREKA moment!)

A Taste of Our Innovations to get Your Juices Flowing…

…Dream Big – We’ll Help Figure Out How

Funds and Mechanisms

Program Related Investments

Businesses acting as a force for good now have another source of funding – investments from charity funds.
From micro loans for entrepreneurs in impoverished countries through housing development in low income communities to Christian filmmaking spreading the Gospel, donations can become investments in for-profit businesses doing good.

Donations as Investments

The IRS code now allows an innovation in charity through using donations as investment in businesses performing work in alignment with the non-profit goals of the fund.

Your donated funds can be invested by Capstone in traditional ways (promissory notes, equity, etc) in businesses in alignment with your donor intent.  The business performs its services and if successful repays the investment with additional returns.

This principle and interest can then be re-invested again in an ever growing cycle or distributed to charities with the similar ministry goals based on your donor intent.

Charitable Annuities & Trusts

These are vehicles for your funds that generate monthly, quarterly, or annual payments for a term or throughout your life (or for beneficiaries you assign).  Upon death, the remaining funds are gifted to the charity of your choice.  An immediate tax deduction, regular income, and the piece of mind of knowing your legacy will fund the charity work God has laid on your heart.

The Details and Differences

A Charitable Gift Annuity is a simple arrangement that involves a charitable gift and an annuity. You make the gift (part of which is tax deductible), and then you receive fixed annuity payments each year for the remainder of your life or to a family member or friend instead. An annuity is a legally binding contract between Capstone and the donor.

This is a type of gift transaction where an individual transfers assets to a charity in exchange for a tax benefit and a life time annuity.  With this Capstone annuity, when the beneficiary dies the annuity payments are stopped and the charity retains the remaining funds.

A Charitable Gift Annuity provides a charitable donation, an income tax deduction, a guaranteed life time income stream, and the certainty your financial legacy will go to the causes your support.

A Charitable Remainder Trust is a separate legal entity, a trust, with Capstone acting as the trustee to ensure your donor intent is followed to the letter.  Like an annuity, the trust makes monthly, quarterly, or annual payments to you or your designee (family, friend, or ministry).

You have the flexibility to set the terms and duration of the trust to allow for the recipient’s financial planning and a clear distribution date for the charity of your choice.

Trusts offer greater security by creating a new legal entity with separate accounting that requires greater reporting including annual tax returns – all handled by the Capstone Legacy Foundation.

Illiquid Assets – Stocks, Property, Business Equity, Etc.

Capstone handles holding or liquidating assets such as heirlooms, art, business equity, stocks, and property – anything of real value – giving you the immediate tax deduction.

Donating Illiquid Assets

Donate real assets for a tax deduction today and have the luxury of distributing the liquidated funds over time.

Reduce capital gains buy donating a portion of a business or property to Capstone before the sale to offset taxes and fund your favorite charity at the same time.

Capstone can distribute the funds, set up a ministry project, or hold them until you have decided on the best use for your charitable gifts.

Family Foundations

Capstone lifts the burden in the compliances and complexities of formation, operation, wind down, and/or legacy preservation when transferring control to the next generation.  You focus on the giving, we cut the costs and do the paperwork.

Capstone Advantages in Forming, Transferring, or Winding Down Your Foundation

Freedom and Flexibility

By establishing your foundation as a fund or trust under Capstone you lighten the regulatory compliance while strengthening your donor intent.  Capstone protects your giving priorities by ensuring distributions only go to the charitable causes you define.

Benefits of Capstone Foundation Fund Vs. Private Foundation
Feature Capstone Foundation Fund Private/Family Foundations
Cash Gifts Tax deduction of up to 60% of Adjusted Gross Income (AGI). Tax deduction of up to 30% of Adjusted Gross Income (AGI).
Required Distributions No requirement on distributions Foundation must distribute at least 5% of corpus each year
Publicly Traded Stock Tax deduction at fair market value up to 30% of AGI. Tax deduction at fair market value up to 20% of AGI.
Closely-Held Stock Tax deduction at fair market value up to 30% of AGI. Tax deduction for your basis in the stock up to 30% of AGI.
Real Estate Tax deduction of 100% of fair market value up to 30% of AGI. Tax deduction limited to cost basis up to 20% of AGI.
Excise Tax Status No excise tax as Capstone Legacy Foundation. Private foundations are subject to excise taxes.
Annual Tax Returns Individual funds are not required to file. Capstone Legacy Foundation prepares and files all tax reports to the IRS. Must file annual Federal income tax return Form 990-PF.
Establishing A Fund A Capstone Legacy Foundation fund can be established in one day with a simple document. Establishing a new foundation requires extensive legal, accounting and operational expenses on an on-going basis.
Investments Capstone Legacy Foundation and its affiliate funds work with professional money managers to invest Capstone funds. A giver may retain their own financial advisor if the fund is greater than $50,000. Selection of investment strategies and professional fund advisors can become a very time consuming responsibility for a private foundation’s Board of Trustees.
Expertise Capstone Legacy Foundation’s experienced board and staff can provide expertise to donors on a wide range of gift management, finance, and fund administration issues. Must hire staff or board members to carry out administrative tasks on their own.
Grant Making The Capstone staff assists givers with grant administration, research, and program evaluation and compliance to ensure maximum community and Kingdom impact. Requires extensive time to review proposals, investigate community needs, confirm status of grantees and evaluate previous distributions.
Accountability Capstone Legacy Foundation conducts an independent audit each year. Publication of an annual report, public disclosure of grants and thoughtful selection of board members ensures funds are used in the communities’ best interests. Laws and regulations governing private foundations differ greatly from those of public charities and may require expensive specialized legal and finance expertise.
Privacy Individual givers or grants can be kept anonymous if the donor wishes. Capstone Legacy Foundation can serve as a buffer between the giver and grant-seekers. Private Foundations are not private. All information about your Foundation is a matter of public record and can be accessed on the internet. This includes such things as salaries paid, names of Board members, and total income, distributions, and assets.
Ease of Administration All donations and grants can be done on-line, thus reducing your need to prepare check, affix postage, and mail the grants. All check writing and letters to go with the check must be prepared by someone in the Foundation.

Registered in all applicable States nationwide, Capstone is a non-profit organization dedicated to supporting charitable wealth management services such as Donor Advised Funds, Ministry Charity Projects, Charitable Gift Annuities, Trusts and other Planned Giving options that provide opportunities to use your wealth to create a legacy.

900 West Valley Road / Suite 203 
Wayne, Pennsylvania 19087 

Tel: (610) 688-8890 
Fax: (610) 688-8891 
info@capstonelegacy.org