Fidelity® Charitable Gift Fund Helps Clients Donate Complex Assets to Maximize Charitable Giving
Consultation Service and Advisor Seminars on Strategic Giving of C- and S-Corp Stock, Limited Partnership Interests and Other Privately-Held Assets
BOSTON, June 3, 2011 — The Fidelity® Charitable Gift Fund ("Gift Fund"), the nation's largest donor-advised fund program and one of the largest public charities in the country, today announced an expanded consultation service for donors and advisors and a series of seminars exclusively for advisors on how to donate closely held, illiquid assets efficiently and for the maximum benefit of donors and the receiving charities. These types of holdings, termed "complex assets," include private C- and S-Corp stock, restricted stock, limited partnership interests, real estate and other privately held assets.
Through the service and seminars, advisors and their clients can review the types of assets available for donating and the process involved, including timing, valuation and liquidation considerations. The seminars will be held in New York on June 16; Philadelphia on September 27; Chicago on October 12; and in Boston on October 20.
"Complex assets are often the most powerful assets to give in a client's portfolio," said Sarah Libbey, president of the Fidelity® Charitable Gift Fund. "The bulk of wealth in this country is held in private companies. Merger and acquisition (M&A) activity is now reaching pre-recession levels, and capital gains taxes are expected to rise. Given all of these factors, advisors have a key opportunity to help their charitably inclined clients who own these non-publicly traded assets give more by minimizing taxes and passing the savings directly to the charities."
With a surge of corporate transactions, including M&A and IPO activity in the market, the Gift Fund experienced donations of complex assets nearly quadruple in the first quarter to $24 million, or 9% of overall contributions. This compares to just over $6 million, or 2%, of overall contributions in the first quarter of 2010.
"While gaining in popularity, there is still a broad lack of understanding of the benefits and the option of donating these assets to charity, and a perceived complexity around the process for doing so," said Karla Valas, managing director of the Gift Fund's Complex Assets Group. "The Gift Fund has the in-house resources to make this process simple for donors and advisors and has built an expertise in this area since our inception 20 years ago."
Valas added that with the recent significant growth in donations of these assets, the Gift Fund has expanded its staff of internal experts in complex assets to provide technical guidance for advisors and donors through its consultation service and advisor seminars.
Complex assets are typically highly appreciated and donating them to charity before a potential sale transaction allows the donor to minimize capital gains tax on the sale of the asset. In addition, by donating these assets to a public charity, like a donor-advised fund, donors can deduct the current market value of the asset.
"Donor-advised funds are uniquely suited to accept donations of illiquid assets especially when a donor has a time-sensitive need, wants to fund multiple charities and/or hasn't decided on charitable recipients," said Valas. "In addition, by using a donor-advised fund, like the Gift Fund, donors realize an even greater charitable impact because grant recipients avoid what could be costly diligence and review efforts if they were to accept these donations directly. The result is more money for the mission of the charity."
Advisors wishing to attend a seminar or inquire about donating a complex asset should contact the Gift Fund at: 800-952-4438.
About the Fidelity® Charitable Gift Fund
The Fidelity® Charitable Gift Fund is an independent public charity, established in 1991, with the mission to further the American tradition of philanthropy by providing programs that make charitable giving simple and effective. Since its inception, the Gift Fund has helped donors support more than 140,000 nonprofit organizations with over $11 billion in grants.
The Fidelity® Charitable Gift Fund ("Gift Fund") is an independent public charity with a donor advised fund program. Various Fidelity companies provide investment management and administrative services to the Gift Fund. The Charitable Gift Fund logo is a service mark, and Giving Account is a registered service mark, of the Trustees of the Fidelity Investments® Charitable Gift Fund. Fidelity and Fidelity Investments are registered service marks of FMR LLC, used by the Gift Fund under license.