Major and Endowment Gift Options

In times of financial, political, and economic uncertainty, several charitable gift options available to donors may be particularly appealing. Of course, not all gifts are appropriate for all donors.

1. Appreciated Assets

Despite recent market volatility, many donors hold appreciated assets, particularly long-term investors. Stocks, real estate, or other non-cash assets acquired years ago may have grown significantly in value, even if their recent performance has dipped. These assets represent an excellent charitable giving opportunity for the donor and your organization.

When donors give appreciate assets directly to your nonprofit rather than selling them and donating the proceeds, they can typically avoid capital gains tax and receive a charitable deduction for the asset’s fair market value if the asset has been held for more than one year.

Donors who focus on short-term fluctuations in their portfolios may not realize the extent of their accumulated long-term appreciation. A thoughtful conversation can help them shift perspective, recognizing that despite recent potential dips, they may still hold highly appreciated assets that are ideal for charitable giving.

Publicly traded securities are the simplest form of appreciated assets to give. Other assets, such as investment properties, vacation homes, or collections can also be donated, though they require additional planning and due diligence.

2. Crypto Giving

Cryptocurrency has emerged as a modern asset class with increasing philanthropic potential. Donors who have invested in digital currencies like Bitcoin, Ethereum, or other crypto assets may hold significant unrealized gains, especially if they purchased early and held long-term. Like appreciated stocks, donating crypto directly to a nonprofit can allow donors to avoid capital gains tax while receiving a charitable deduction for the asset’s fair market value at the time of the gift.

Crypto giving may appeal particularly to younger donors, tech-savvy supporters, and those looking for tax-efficient ways to support causes they care about. Accepting cryptocurrency can position your organization as forward-thinking and accessible to next-generation philanthropists.

To receive crypto donations, organizations typically partner with a third-party processor or custodian that immediately converts the donation into cash or holds it according to your policy. Establishing a gift acceptance policy for crypto, including how assets will be valued, held, or liquidated is important.

3. Retained Life Estate

A Retained Life Estate (RLE) allows a donor to make a significant gift of real estate, such as a primary residence, vacation home, or farmland, while continuing to live in or use the property for the rest of their life. In this arrangement, the donor irrevocably transfers ownership of the property to your organization but retains the right to occupy or use it for the remainder of their life or for the lifetime of another person they designate. Once that life interest ends, your organization takes full possession of the property.

RLEs can be especially appealing to donors with highly appreciated property, as it allows them to make a more significant gift than they may have thought possible. In return, they receive a current charitable income tax deduction based on the present value of the remainder interest, as calculated using IRS life expectancy tables. The property is also removed from their taxable estate, potentially reducing estate taxes, and they may avoid immediate capital gains tax on the appreciation. During their lifetime, the donor maintains the property and is responsible for taxes, insurance, and upkeep.

Retained life estates can be a powerful giving strategy for donors who are deeply committed to your mission but not yet ready to part with the property they call home.

4. Depreciated Assets

If a donor holds stock or other assets that have decreased in value since purchase, it is usually more beneficial for them to sell the assets first and then donate the cash proceeds. By doing so, the donor can claim a capital loss, which can offset other gains or income, while also receiving a charitable deduction for the cash gift. Donating the asset directly would forfeit the capital loss and limit deduction to asset’s current, lower market value.

5. Cash

Many donors will still elect to make cash gifts, even when the market is volatile. In fact, some may have already moved assets out of equities and into cash, giving them greater liquidity. Don’t assume donors are waiting for “better timing.” They may prefer to put their resources toward meaningful impact today rather than risk further market declines.

6. Intent to Give vs. Pledge

If you are in a campaign right now, you may find that some donors are hesitant to make multi-year commitments, and that’s completely understandable given the current economic climate. If a donor is considering a significant pledge, like $500,000, invite them to begin with an initial gift of $100,000 now. Let them know they can formalize the rest of the commitment later, as conditions improve. You can document this understanding with a written, nonbinding letter of intent, which expresses their philanthropic goals without locking them into a binding contract. This approach honors their generosity, respects current uncertainties, and keeps the momentum of your campaign moving forward.

7. Income Only Gift or “Virtual” Endowment

Some donors who wish to support the long-term sustainability of your mission may opt to fund the annual impact of an endowment principal during uncertain economic times. For example, rather than contributing $1 million to establish an endowment today, a donor might commit $40,000 annually, the equivalent of a 4% endowment payout for five years. When the circumstances allow, the donor may complete the full endowment gift through an outright contribution, planned gift, or both.

8. Bequests by Will or Trust

The bequest market remains strong, particularly among donors aged 65 and older who may prefer to retain control of income-generating assets during retirement. Bequests allow donors to make a meaningful legacy gift without impacting their current financial security and may find great satisfaction in knowing that their values will live on through their philanthropy. When stewarded well, these donors often appreciate recognition and engagement during their lifetimes.

Bequests are the most common form of planned gift, accounting for 75-80% of all planned gifts annually. A donor can name your organization as a beneficiary in their will, trust, or through other tools like retirement accounts or life insurance policies. Although these gifts are revocable, most donors do not make changes once they’ve included a nonprofit, especially when the relationship is actively nurtured.

9. Charitable Lead Trust

A Charitable Lead Trust (CLT) pays a set amount of income each year to one or more charitable organizations for a specific number of years. When that period ends, the remaining assets in the trust are distributed to non-charitable beneficiaries.

Who received the CLT’s principal at the end of the term? It’s often the donor’s children or grandchildren, which can lead to estate or gift tax savings. While only a small percentage of Americans currently pay estate taxes, the exemption is set to expire in 2026, which could lead make CLTs more attractive to more donors.

There are different types of CLTs. In some cases, the donor receives an immediate income tax deduction but pays tax on the trust’s income. In others, the trust pays its own taxes, and the donor does not get an upfront deduction but can still pass assets to heirs in a tax-efficient way.

CLTs tend to be most effective in a low-interest rate environment, where they can generate larger charitable deductions.

10. Charitable Gift Annuity

A Charitable Gift Annuity (CGA) is a simple contract in which a donor makes a gift of cash or appreciated property to a charitable organization. In return, the charity agrees to pay a fixed income to one or two individuals for life. The payment amount is determined at the time of the gift and does not change, regardless of market conditions, providing predictable income for the rest of the annuitant’s life.

Donors receive a partial income tax deduction, and a portion of the payment may be tax-free. The income can be paid to the donor or someone else, such as a spouse or sibling. Payments are backed by the general assets of the issuing organization.

CGAs are especially appealing to older donors and those planning for retirement. In today’s environment, CGA rates remain competitive with many conservative investment options, and donors appreciate the added benefit of supporting a cause they care about. Donors who have already included a charity in their estate plans may find a CGA a meaningful way to begin their legacy now while also receiving income.

11. Retirement Plan Beneficiary Designation

For many people, retirement accounts like IRAs and 401(k)s are among their largest assets, often second only to a home. That’s what makes them such powerful tools for planned giving. These accounts aren’t just significant in size, they are also among the most tax-wise assets to leave to charity. While heirs will owe income tax on any distributions they receive (and in some cases, estate tax as well), charitable organizations can receive those same assets tax-free.

Both IRAs and 401(k)s can be used to make a meaningful gift through a simple beneficiary designation. That said, the process isn’t always the same. IRAs tend to be more flexible and easier to manage for charitable gifts. 401(k) plans can also support charitable bequests, but some plan providers may have extra administrative steps or limitations. That’s why many donors choose to roll 401(k) balances into IRAs in retirement, as it simplifies giving and estate planning.

12. IRA Qualified Charitable Distributions

Individuals aged 70½ or older can donate up to $108,000 tax-free from their IRA to charitable organizations. The Qualified Charitable Distribution (QCD) can count towards their Required Minimum Distributions (RMDs) once they reach the age of 73, which potentially lowers their taxable income. QCDs must go directly from the IRA custodian to the charitable organization. The SECURE 2.0 ACT also introduced a one-time option of making a QCD of up to $54,000 to certain split-interest vehicles, like charitable remainder trust or charitable gift annuities.

13. Life Insurance

Donors may make gifts of paid-up life insurance policies and take a tax deduction (essentially cash surrender value). Or donors may make gifts of premium-due policies to the organization and then take a tax deduction for gifts to the organization to pay premiums.

Alternatively, the donor may choose to retain ownership of the policy and name the organization as the beneficiary of the policy at the donor’s death. In a written letter of agreement, the donor may direct your organization to add the policy proceeds to its endowment and may describe any restriction on using the fund’s distributions.

14. Market-Based Pledge

A market-based pledge, also known as a market-contingent intention, is a donor’s informal commitment to transfer appreciated assets to a charitable organization once those assets have reached a certain value. While expressions of intent can be powerful cultivation tools, they are considered conditional and, therefore, not bookable or countable under CASE of FASB standards. Organization should steward the donor appropriately while deferring permanent recognition until the asset is received.