Category: Philanthropic Planning

2019 HudsonAlpha Tie the Ribbons Event

Jessica, Chad, Lauren, Jonathan, and Debbie attended the 2019 Tie the Ribbons event held at the VBC North Hall. The annual event was informational and moving, as always.

HudsonAlpha Institute for Biotechnology‘s breast and ovarian cancer research team of scientists are “committed to the goal of using genomic science and HudsonAlpha’s state-of-the-art technology to find new breakthroughs in breast and ovarian cancers.”

To learn more about the event, visit https://hudsonalpha.org/foundation/tie-the-ribbons-event/

Guest Post: Planned Giving with Food Bank of North Alabama Development Director, Bobby Bozeman

Considering where you’re reading this, I’m going to assume that you already have a pretty good idea of why planning gifts to non-profits, whether from your retirement plan or a bequeath from your will or life insurance policy, is good for you. There are, of course, the great tax reasons, and they are incredibly flexible, but it’s also many people’s only opportunity to leave their charities of choice with that major gift they’ve always wanted to give but haven’t been able to.

A planned gift also allows donors to create a legacy. It doesn’t just leave a lasting mark on the charity or non-profit you choose to give to, but it also creates a lasting impact on your community, leaving the world a little better than what you inherited. 

And on our end of things, planned giving is extremely important as well. Over the rest of 2019 and through 2020, the Food Bank of North Alabama will be putting forth a campaign to inform our supporters about planned giving options as well as creating a society to honor those who choose to consider the Food Bank in their planned gifts.

We’re wanting to make this push with our current supporters and with new potential ones because planned giving provides a sturdy foundation of long-term support. While it’s tempting for me as development director to focus on gifts that come in right away and make an immediate impact, I want to make sure we have long-term stability. Because there are so many agencies — over 260 soup kitchens, food pantries, churches, women’s shelters, halfway homes, child backpack programs, senior feeding programs and more — across North Alabama that depend on us for food, it’s so important that we are here for as long as people are hungry. Planned giving allows us to better navigate any unforeseen problems that might be awaiting us on the horizon.

The Food Bank of North Alabama was honored to be featured in this blog in 2016, but I wanted to share a few ways we’ve grown since then. Many of our programs have changed, most morphed into new programs with new names as new staff members take hold of them.

But the biggest change since 2016 is how much food we’ve been able to provide the people of the 11 counties in North Alabama that we serve. Then we supplied nearly seven million pounds of food to over 200 charitable feeding programs. This year, we are on track to supply 10 million pounds of food to over 260 charitable programs. It’s all because people who choose to support us. 

If you’d like more information about the Food Bank of North Alabama, please visit foodbanknorthal.org, and for more information about planned giving or to let us know you’ve made a planned gift to the Food Bank, email Bobby Bozeman at bbozeman@fbofna.org.

Sonny Hereford Cheese Distribution

Community Foundation of Greater Huntsville’s 2019 Summit on Philanthropy

Longview team members, JJ, Jessica, and Andrew recently attended the Community Foundation of Greater Huntsville’s Summit on Philanthropy. The Summit is “an annual celebration of our community’s generosity because we believe that together we can accomplish more than any one person, one company, or one organization can accomplish on their own.” The gala-style event, celebrating its 10th year, was held on Tuesday, September 10th at the Westin Huntsville in Bridge Street Town Centre.

Longview has long been a supporter of the Foundation’s work in our communities, and we are proud to continue our sponsorship of the Summit. Jessica Hovis Smith and Jeff Jones are both members of the Community Foundation’s Philanthropic Advisors Network. Please contact us if you are interested in learning more about The Community Foundation or would like to talk about your desires to become involved or create your own giving plan. You can also learn more by visiting the Community Foundation’s Web site at communityfoundationhsv.org.

Jeff Jones, Jessica Hovis Smith, & Andrew Gipner

Guest Post: A Look into Conservation Easements with Land Trust of North Alabama Executive Director, Marie Bostick

Today’s guest post is by Marie Bostick, Executive Director of Land Trust of North Alabama.

Many different strategies may be employed to conserve land including, donations, bargain sales, bequests and conservation easements.  Each has its own benefits and constraints based on the goals of the parties involved in the transaction. This article will focus on the use of conservation easements.

A conservation easement (CE) is a land conveyance from a private land owner to either a governmental entity or non-profit 501(c)3 Land Trust, which places restrictions on a property that has appropriate conservation values. The holder of the conservation easement (either the Land Trust or governmental entity) is responsible for monitoring the property in perpetuity to make sure the easement provisions are not violated.  The easement itself is negotiated between the parties to meet specific conservation goals and allow the land owner the continued to use of the property, so long as the uses don’t conflict with the conservation goals.  A key benefit to a conservation easement is the land owner’s ability to take a federal tax deduction for the value of the donation.  However, in order to take advantage of these tax benefits, the land owner must comply with the IRS Code requirements.

IRS Code 170 (a) and (h) provide the requirements that must be followed to execute a “qualified” conservation easement. One of these requirements is that a “qualified” entity – such as the Land Trust of North Alabama – must hold the easement. Another requirement, as mentioned above, is that the easement be held in perpetuity. For example, the restrictions that are placed on the property through the CE must be in the recorded document and the Land Trust must monitor and enforce those restrictions forever. In the event the fee interest in the land is sold to another party, the conservation easement will run with the land and the restrictions remain in effect. In order to assist the entity that is holding the easement to perform its enforcement obligation, a stewardship and defense donation is often included as a part of the overall transaction. Of course, a key requirement is that the property serves a valid conservation purpose, and the IRS Code list four conservation values that are used to make this determination.  Most land trusts also have criteria for conservation properties which must be met. While there is often overlap between these conservation values, the land owner and conservation easement holder must work together in determining if the conservation easement is appropriate for both parties. Lastly, the CE must be substantiated, which is typically done through a qualified appraisal and appraiser and documented by way of a Form 8283.

While completing a Conservation Easement to the standards of the IRS and the easement holder is a meticulous and detailed process, a landowner can realize substantial federal tax benefits.  Currently, a landowner can deduct the value of the conservation easement donation up to 50% of their annual income and carry forward any remaining donation value for period of up to 15 years.  Qualified ranchers and farmers are eligible for greater tax incentives, with the ability to deduct the value of their donation up to 100% of their annual income, with a carry forward period of 15 years.

Executing a conservation easement is a complicated process and the benefits vary with each person’s unique situation. Anyone considering a conservation easement should consult with their own tax professional to determine whether it is a viable option for them.

For information about Land Trust of North Alabama and working with them to protect your land, visit www.landtrustnal.org/preserve-land.

Five Keys to Determine the Effectiveness of a Nonprofit

We just celebrated one of my favorite days of year – Giving Tuesday. It is one of my favorite days because, perhaps even more so than on Christmas, it is a reminder to think outside of ourselves.

With companies, like Facebook, matching contributions, and #GivingTuesday challenges, there is increasing access to donations. This is great for nonprofits doing amazing work, but as a donor, how do you filter out all the buzz and peer pressure and ensure the nonprofits you support are effective?

Too often, efficiency gets confused with effectiveness. An efficient organization eliminates waste and maximizes productivity. An effective organization fulfills its mission. While an effective organization should consider efficiencies, efficiency alone is not the goal. All too often, donors are quick to zero in on the percentage of donations used for administrative expenses, like salaries, overhead, and general expenses to maintain the operation of the organization. While this is an important consideration, it is just one consideration when evaluating a nonprofit’s effectiveness.

5 Factors to Consider

  1. Mission: The most important determination of whether a nonprofit is effective is if it is achieving its mission. Make sure you know what you are supporting. Do a little research to determine the nonprofit’s mission. The first place to start is the nonprofit’s website, but there are other third-party resources like GuideStar (www.guidestar.org), Charity Navigator (charitynavigator.org), and your local Community Foundation that can help.
  2. Goals and Programs: Does the organization have very specific and measurable goals? Think SMART goals – Specific, Measurable, Achievable, Relevant, and Time bound. Are the nonprofit’s programs set up to achieve the specific goals and does the nonprofit report on the performance of those goals – positive and negative? Most nonprofits offer an annual report to donors. Ask for the previous year’s report in advance and pay particular attention to how achievements are discussed. The more transparent, the better!
  3. Financial Wellbeing: Pay attention to the financials of the organization, but as a whole, considering the nonprofit’s mission, goals, and programs. If the nonprofit is tackling big tasks, it needs a strategic, focused leader at the helm with other dedicated talented individuals supporting, just like a for-profit organization does. Be careful not to judge too quickly based on the amount paid in salaries alone. Also consider where the nonprofit is located and the marketing and overhead costs necessary to accomplish goals. Just like any other business, marketing and overhead are needed expenses to help facilitate higher performance. It may be helpful to compare financials of different nonprofits, but only do so if you are comparing apples to apples. The nonprofits should do very similar work, in a similar location with similar goals.
  4. Leadership: Check into the leadership of the nonprofit, both the internal leadership and the board leadership. Is the leadership engaged? Can they speak to the mission and goals of the organization? Do they implement a strategic plan? Are there checks and balances? Are there policies and procedures in place? Are there regular board meetings and term limits for board membership? Sometimes measuring the effectiveness of the leadership can be difficult. Before making large contributions to an organization, it may be helpful to sit down and interview both the Executive Director and the board (or at least a representative of the board) to ensure that they are on the same page and working well together.
  5. Collaboration: Think about the nonprofits with the best reputations. Many of them have dedicated volunteers and donors who are committed to the mission. This doesn’t mean that the nonprofit has to be one of the biggest, it just needs to be able to facilitate work through others. It needs an engaged group advocating for the mission. The leaders, volunteers, and donors need to be willing to break down fences to partner with others to create great impact, even if that means sharing resources and taking a smaller cut of the pie.

Above all, it is important that the resources you give align with your core values and passions. Before you make your next gift, I challenge you to take time to consider your top three key core values and three areas of interests and ask yourself how they relate. Are there any common threads? Write down your findings and keep them as a reference for the next time you are asked to give. If the request doesn’t align with your core values and passions, give yourself the freedom to say no. If the request does align with your core values and passions, say yes and follow through to ensure your gift is used wisely. You hold the power of impact in your hands. What will you do with it?

Bridging the Generation Gap: Using Philanthropy to Create Successful Families

Everywhere you turn, it seems like we are hearing about the differences in generations. It is almost certain that if I attend an educational conference, there will be at least one session about how to work with the next generation or how the next generation is different from all the other generations. These conversations are usually targeted toward the workplace, but I don’t hear many targeted toward the family. However, the differences apply across industries and families alike. Don’t we desire to better communicate at home and passing on education and skills in the home as much as in the workplace?

A few years ago, I came across Strangers In Paradise – How Families Adapt to Wealth Across Generations by Dr. James Grubman. Dr Grubman is a psychologist who works with individuals with wealth. Through his research, he has addressed the question of how families can share education and skills and better equip the next generation to inherit and sustain wealth. It is an interesting read that compares migrating to the “Land of Wealth” to migrating to a new country. He essentially divides the “Land of Wealth” into two groups: immigrants and natives.

Immigrants are those who create the wealth. They often come from humble beginnings and build their wealth by taking risks, like starting a business. Immigrants make up 80% of the inhabitants of the “Land of Wealth”. The remaining 20% are the natives. They are second and later generations who have grown up with more opportunities and experiences because of the family’s wealth. Many times, their parents have wanted them to have all the things they couldn’t have as a child. Natives are usually less experienced with risk and may not understand the amount of hard work that was necessary for the previous generation to generate the wealth.

As you may expect, each generation has its own struggles. The immigrants may struggle with trusting the next generation to carry on the wealth (or family business). They may also struggle with accepting and using the wealth, remembering the days before their success as hard and financially tight. This non-acceptance may lead to poor decisions and a tendency to give away wealth to others too easily. On the other hand, natives can struggle with a sense of entitlement due to a lack of understanding about the hard work necessary to create it. They may overspend or not consider the financial consequences of their decisions. Some may even feel pressured to carry on the previous generation’s values and desires because they do not think the wealth belongs to them.

Dr. Grubman argues that there are different skill sets that are necessary at each generation level in order for family wealth to continue. As you can see from the chart below, the skills needed grow with each new generation. This is why it is so hard to keep family wealth for the long term.

Adapted from Strangers in Paradise by James Grubman

Just like an immigrant to a new country, immigrants to wealth primarily transition into the “Land of Wealth” in one of three ways.

Avoidance

Some try to avoid the wealth and deny they are wealthy. They continue to live as they were before they earned their wealth, fearing the loss of relationships or judgements from their old circle of acquaintances. It is important to note that remaining frugal is not avoidance. Avoidance is an inability to accept the wealth or a strong desire to ensure others do not know about the wealth.

Assimilation

Some immigrants embrace wealth to its fullest. They may see it as a way to create happiness. While avoiders may not want to leave their old circles, assimilators may completely leave their old circles to create new circles with those who also have wealth. They tend to raise their own and their children’s standard of living drastically in an effort to fit into their new land and may do so at their own detriment. Some assimilators become more philanthropic, but may do so to appear wealthy, not necessarily because they feel a strong connection or desire to do good.

Integration

The last group of immigrants takes a more balanced approach and integrate their old and new relationships, communities, and values. They may look to their wealth to help them create new opportunities and experiences, but also remember the importance of saving and giving for purpose. They make a point to teach their children about their past while also giving them the opportunity to enjoy and learn from their new life of wealth. Integrators tend to be more adaptable.

Dr. Grubman further suggests that in order to allow for integration and to pass along and teach the skills needed at each generation, it is best to introduce the concept of family capital. He divides family capital into four subgroups. Human capital includes the values and personal attributes each individual brings to the family. Intellectual capital is the education and skills each member can provide. Social capital includes the family’s connections, community involvement, spiritual capital and philanthropy. Financial capital is the wealth and stewardship of the family.

By identifying the family’s capital, the family is better equipped to use the skills of each individual member for the betterment of the family unit and to recognize areas that may need improvement. Some examples of questions that can be asked to help facilitate a family discussion around capital includes:

  • Human Capital
    • What are the individual attributes of each family member, and how does the family use and share the skills of individuals within the family?
    • How can the family enhance members’ skills?
  • Intellectual Capital
    • What are the family’s core values and mission?
    • How is the family using each member’s education?
  • Social Capital
    • What/Who are the family’s connections?
    • What are the family’s philanthropic goals and how can each individual contribute to the goals?
  • Financial Capital
    • How can the financial capital be used to address the human, intellectual, and social capital?
    • How will stewardship be addressed?

Philanthropy is an excellent way to help address some of the questions above and to begin to build the skills that generation 2 and 3 need in order to inherit and pass on family wealth. For example, in order to begin to build human capital at an early age, parents could encourage their children to use their interests and abilities to volunteer or to look for volunteer opportunities that will enhance a child’s skills. Encouraging children to assist in determining the family’s giving goals, identifying which nonprofits the family should support, and what amount of support to give are ways to address the family’s capital while building leadership, financial, and relationship skills.

Regardless of your wealth level, improving your children’s and grandchildren’s financial and philanthropic literacy is important. We invite you to contact us if you are interested in learning more about ways to implement Dr. Grubman’s research with your own family.

In the meantime, here are some great, age-appropriate examples of using philanthropy to build your children’s skills that you can put into practice now:

The Women’s Endowment – For Women By Women

The Women’s Endowment – For Women By Women

The Community Foundation of Greater Huntsville recently launched a new initiative established for women by women. The Women’s Endowment “is Huntsville’s first permanent grantmaking endowment that seeks to make a positive difference in the lives of women and families across a broad spectrum of issues that impact the Quality of Life in our community.”

The endowment’s goal is to offer larger annual gifts or multi-year commitments that fund initiatives “that address systemic change and that create positive and measurable impact for women and families.”

Longview’s Jessica Hovis Smith is proud to serve on the Women’s Endowment Advisory Council. The Council is made up of women leaders from the community acting as volunteer stewards for the Endowment.

The Community Foundation celebrated the launch with the Legacy of Love event. Click here for photos from the event.

Click here to learn more information about the Women’s Endowment, including answers to frequently asked questions.

Contact us if you are interested in learning more or getting involved.

2017 Kids to Love’s Denim & Diamonds

Longview proudly served as the Presenting Sponsor for Kids to Love’s inaugural Denim & Diamonds event held on Saturday, April 29th, 2017. 

The Denim & Diamonds event was held as a fundraiser and open house for Davidson Farms, a 10,000 sq.ft. home on 10 acres in Madison County, Alabama. The home, a gift from Dr. Dorothy Davidson, will serve as “A Home for Girls” for tween and teen girls in foster care. Guests were treated to a tour of the newly-remodeled home, garden-to-table dinner on the grounds, and entertainment by The Michaels. With over 200 in attendance, the event raised over $30,000 through tickets, donations, and a live auction.

How To Give or Support Kids to Love

Kids to Love is a 501(c)3 organization that has several opportunities to volunteer and give financially. In addition to the education programs listed on their website, they also need funding and volunteers for the following:

  • Bibles For Kids – An opportunity to buy a foster child a bible for $5.
  • Christmas For Kids – An annual drive for Christmas gifts for foster children. You can sponsor an entire wish list, donate individual items and money or volunteer to wrap presents.
  • Camp Hope Alabama – S weekend camp that serves to reunite foster siblings that have been separated and offer them a home-like environment with fun activities.
  • More than a Backpack – Sn annual school supply drive. Kids to Love sends out over 5,000 backpacks full of school supplies every year to students in Alabama, Tennessee, Georgia and Mississippi. There are opportunities to donate or host a drive.
  • Scholarships – Kids to Love honors students each year with scholarships, giving out 448 scholarships since 2005.
  • Davidson Farms – In addition to monetary donations, they are looking for donations of household furnishings, appliances, decorations, etc. There are also potential naming opportunities should you be interesting in sponsoring a room.
  • Legacy gifts – Kids to Love also works with donors on legacy gifts. If you are interested in giving through your will or another future donation, they are happy to discuss options with you.

How to Contact Them and Learn More

If you are passionate about helping children and are interested in learning more about Kids to Love, their programs or ways to volunteer or give, you can visit their website or on Facebook

Lauren, Jessica, Lee Marshall, & Whitney
Larry & Debbie West
Whitney & Lauren

Cash Isn’t Always King

Whether in the business or investment world, you’ve undoubtedly heard the phrase “cash is king.” The idea is that cash may be the best investment because it gives you options. Whether it is the opportunity to invest during a falling market or for a business to make an acquisition or investment, cash serves an important purpose. However, cash may not be king when it comes to charitable donations.

Tax law allows for favorable treatment of charitable donations. You can receive a deduction, if itemizing, for every dollar that you donate to a 501(c)(3) company (nonprofit). The deduction is limited to 50% of your Adjusted Gross Income (AGI) for donations to public charities and 30% of AGI for donations to private charities. The value of that deduction depends on your marginal federal and state tax brackets. For example, if you are in the 25% federal tax bracket and the 5% state tax bracket, each dollar given to charity is worth .30 cents of tax savings to you. This is a pretty sweet deal, right? You can save taxes by donating to causes and nonprofits that matter to you. BUT…the deal can be sweeter.

If you own an appreciated asset, like a stock or mutual fund, that has been held for over a year, then cash is no longer king for you. Instead, you get more benefit per dollar (and more options) by donating the appreciated asset to the charity because you not only receive an income tax deduction for the market value of the stock or mutual fund, but you also bypass the capital gains tax on any growth in the investment. This is a huge win-win. You get more tax savings and the charity still gets the benefit of the gift. Here’s an example:

  Cash Appreciated Asset
Fair Market Value $10,000 $10,000 (purchased for $4,000)
Long Term Capital Gains $0 $6,000
Charitable Donation $10,000 $10,000
Capital Gain Tax Avoided $0 $900 (assuming 15% federal)
Non-taxable Amount $10,000 $10,900*

*Total Tax Savings is increased if you pay state income taxes

Using an appreciated asset resulted in 9% more tax savings in this scenario than a direct cash donation.

Please notice that I said that cash may not be king. Deductions for appreciated assets are limited to 30% of AGI for donations to public charities and 20% for donations to private charities, which are more stringent than the limits for cash donations. Therefore, for a donor who is brushing up against these deduction limits, a combination of asset donation and cash donations should be considered.

Please contact your advisor if you are interested in learning more about donating appreciated assets.

What is a Chartered Advisor in Philanthropy®?

In 2016, we announced that Jessica Hovis Smith earned the Chartered Advisor in Philanthropy® (CAP®) designation, but what is it and why is it important to us?

The Chartered Advisory in Philanthropy® designation is granted by the Richard D. Irwin School of The American College, also known as The American College of Financial Services®. The designation is recommended only for experienced advisors who already hold credentials such as Chartered Life Underwriters®, CERTIFIED FINANCIAL PLANNERS™, Masters of Science in Financial Services, and CPAs. It is intended for financial planners who want to “help clients articulate and advance their highest aspirations for self, family, and society.”[i]

Coursework includes master level coursework in:

  • Planning for Impact in Context of Family Wealth
  • Charitable Giving Strategies
  • Gift Planning in a Nonprofit Context

The CAP® program provides financial advisors and planners with the knowledge and tools to provide high-level philanthropic and charitable planning to clients. It prepares advisors for advanced design, implementation, and management of charitable gift techniques, as well as philanthropic tools including charitable trusts, private foundations, donor-advised funds, pooled income funds, and charitable annuities. 

Several years ago, we began to look deeper at our company and our clients. What we ultimately discovered was a deep-seated desire for giving back, and the feelings were frequently shared across our employee and client base. As a company, we made the decision to fuel that desire, and in doing so, the company pivoted toward a new mission:

Empower our clients and team members to think big, make a positive impact in the world and feel the joy of using their wealth, talents, and experience to improve their lives and help others do the same.  

The completion of the CAP® designation was the first step to furthering Longview’s mission. In addition to the deeper level education, we have also implemented several initiatives.

  • “Longview Gives Back” started internally through the creation of our company giving program. It has expanded from there to include blog highlights on the non-profits in which our company and team members have actively participated.
  • We have worked diligently to build out our centers of influence, focusing on local individuals and organizations that may be of benefit to and may benefit from working with our clients. A couple of examples of this include our involvement with the Community Foundation of Huntsville/Madison County’s Philanthropic Advisors Network and the HudsonAlpha Professional Advisory Committee.
  • We’ve created education materials and conducted presentations to assist individuals and companies to become more strategic in their giving and create their own giving plan.
  • We’ve established relationships with local non-profits to provide education in ways that they may build out their planned giving programs. As part of this initiative, we offer presentations to their donors about the most advantageous ways to give and strategies to create impact.

Let us know if you are interested in learning more about ways to give back and make an impact.

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