Businesses can gain immensely from charitable trusts, though these trusts are nonprofit organizations that are set up for the benefit of some other party. That is the reason why most businesses are setting up charitable trusts for themselves. It is not too difficult to set up a charitable trust either. A minimum amount of $100,000 worth in assets is enough to be eligible to set up a charitable trust. In addition, there are several privileges that charitable trusts have.

The following is a list of these privileges:

- Charitable trusts will not cease to function even if they have not been able to fulfill their initial goals. These trusts have what is known as cy pres, a provision that allows charitable trusts to change their beneficiary options if they are not able to meet the first one.

- Charitable trusts can remain working perpetually, which is not the case with other organizations. Most establishments have a particular tenure after which they have to either renew licenses or cease to function, but charitable trusts can go on indefinitely if they so wanted.

- Charitable trusts are given permissions to establish themselves even if their beneficiary options do not seem to be quite concrete. Even if there is just a philanthropic concept, charitable trusts are given permissions to start.

Hence, it is very easy to start charitable trusts. That is what businesses do. The charitable trusts do fulfill the noble intention of serving some beneficiary, which could be an individual, a group of persons or an establishment. At the same time, the charitable trusts help the owners to manage their resources well.

The following is a list of benefits that the owners of charitable trusts are provided by the authorities:

- Charitable trust owners are exempted from a portion of their estates taxes. These taxes can even be waived off if the established charitable trust is large enough in its scope.

- Charitable trust owners are also benefited in terms of capital gains taxes. In this way, charitable trusts help to increase the overall income of the owner of the trust.

- In case of retirement or winding up of business, the charitable trust funds can be used as a sort of retirement benefit plan for the owner. The charitable trust will continue to work as long as there are funds in it. However, it will also pay for the expenses of the owner.

- Charitable trusts are very handy if there is a sudden demise of the owner of the assets. These trusts will then appoint a living trustee – or the living trustee could be appointed during the lifetime of the owner – and this living trustee will undertake the proper disbursement of the assets among the survivors. This happens if no will is made, and in many cases, even if there is a will, the living trustee can supersede the will in some points. An advantage of this arrangement is that the survivors do not have to wait for lengthy probate periods and nor do they have to pay heavy fees for legal procedures.

That is the reason why setting up a charitable trust is a worthwhile idea when the person is still alive. It will help to improve assets during life, and will help to properly disburse assets after death. Setting up a charitable trust is easier than setting up other organizations. However, since the rules differ from one place to another, it is necessary to look into state laws before planning to go ahead with the idea of setting up a charitable trust.

We don’t normally question the motives or charitable giving of others.  The fact that people willingly give of their wealth, their time and other resources is something we are proud of, and thankful for.  But if you ever wondered about how people give, or who gives more of their money in the U.S., that’s a question that’s been answered, at least recently.   There’s an interesting OP-ED article this week in the New York Times by Nicholas Kristof titled Bleeding Heart Tightwads.

That may give you some indication of the storyline.  Based on the research, it looks like conservatives give a lot more of their personal wealth to charitable causes than do liberals.  It bothers me to stereotype people, but that’s basically what the article, and the research has stated.

“Liberals show tremendous compassion in pushing for generous government spending to help the neediest people at home and abroad. Yet when it comes to individual contributions to charitable causes, liberals are cheapskates.”

“Arthur Brooks, the author of a book on donors to charity, “Who Really Cares“, cites data that households headed by conservatives give 30 percent more to charity than households headed by liberals. A study by Google found an even greater disproportion: average annual contributions reported by conservatives were almost double those of liberals”

 The data is surprising, especially given the research when the results didn’t come back as expected. 

“When I started doing research on charity,” Mr. Brooks wrote, “I expected to find that political liberals — who, I believed, genuinely cared more about others than conservatives did — would turn out to be the most privately charitable people. So when my early findings led me to the opposite conclusion, I assumed I had made some sort of technical error. I re-ran analyses. I got new data. Nothing worked. In the end, I had no option but to change my views.”

So assuming the research is accurate, then what is really going on?  Why do liberals give less of their personal wealth than conservatives?  And what does it really tell us?  Mr. Brooks indicates that religion plays a large role in charitable giving, and that religious liberals and conservatives give about the same.  But it’s interesting that conservatives came out ahead on other charitable giving approaches- themselves.

“Conservatives also appear to be more generous than liberals in nonfinancial ways. People in red states are considerably more likely to volunteer for good causes, and conservatives give blood more often. If liberals and moderates gave blood as often as conservatives, Mr. Brooks said, the American blood supply would increase by 45 percent.”

We all have our own opinions of these matters, but personally I believe the values that conservatives and the red states have, especially regarding religious convictions, leave them much more inclined to give of their wealth and time.  It’s something that is instilled within families as children are raised, and it speaks toward a sense of community.   And when your peers (and congregations) are giving, maybe it leaves one more inclined to do the same.

One thing does bother me though- the seeming indifference to the degree of charitable giving that Americans provide internationally.  In the history of the world and all mankind, there has never been a nation that has given so much to others as does the U.S. in foreign aid, food, programs and the help of our people.  Mr. Brooks’ research found the same thing.

“Something similar is true internationally. European countries seem to show more compassion than America in providing safety nets for the poor, and they give far more humanitarian foreign aid per capita than the United States does. But as individuals, Europeans are far less charitable than Americans.”

“Americans give sums to charity equivalent to 1.67 percent of G.N.P., according to a terrific new book, “Philanthrocapitalism,” by Matthew Bishop and Michael Green. The British are second, with 0.73 percent, while the stingiest people on the list are the French, at 0.14 percent.”

This OP-Ed article has generated a lot of interest by readers of course, and Mr. Kristof’s blog, On the Ground, has generated hundreds of “Comments on Stinginess“ by supposed conservatives and liberals espousing their beliefs and opinions.

I am not in agreement with those who believe fostering government policies that increase spending to help the needy is “being charitable.”  For one thing, that’s spending other people’s money, namely taxpayers, and does not reflect a degree of individual charity.  But what about giving to the arts or sciences, or other worthy causes such as the environment?  Well, I agree that may qualify as charitable giving, but does it really help people in need?  I don’t think so… and for me, that’s where charitable giving really makes a difference- in the lives and welfare of our fellow human beings.

All in all, it would be far better not to worry about “who gives more” and to work harder instead on ways to help those really in need.  Liberal or conservative, it really doesn’t matter.  Especially during the holiday season, and the challenging times we face.  Donating more of our money, time or personal attention to helping others is something that can really make a difference.

On this Veteran’s Day, we remember those who have served and are serving the nation still today.  Their lives are filled with challenge and sacrifice- some far too much.  But we are grateful, and proud of those who choose to serve in the military.

There are many charitable organizations that help military veterans and active duty service members.  Too often these organizations barely make ends meet, but they fulfill a critical role in supporting injured veterans and those trying to get a new start on life as civilians.

One of the best things we can do when considering a charitable donation to a veteran’s or public service organization is to make sure our contribution will be used effectively.  Charity Navigator is one of the best sites for exploring charities, and they rate non-profit organizations on the basis of how effectively they put donations to work, as compared to how much money is spent on actual charitable efforts rather than administrative expenses.

“Any charity that spends money inefficiently is doing a disservice to both its donors and its intended beneficiaries, but the fact that these charities are using the good name of America ’s heroes to raise donations and then end up spending most of these donations on fundraising or administration is especially sad. Donors become victims when their donations are not used to benefit their local police, firefighters or service men and women as they had thought. Police, firefighters, and veterans are doubly hurt both because they don’t receive the assistance they need, and because people who give to a poorly-run, inefficient charity once, may be hesitant to donate to a well-run police, firefighters, or veterans charity in the future.”

What else can we do to make sure our money will be used effectively?  Charity Navigator has three primary recommendations:

• Give locally. Don’t trust a charity based in another state that promises that it will give money to police, firefighters or veterans in your state. If you want to support your local or state police, fire station, or military unit contact them directly and find out where they prefer to have donations given.
• Never give over the phone. Of the charities with high fundraising expenses, much of their money is spent on for-profit telemarketing companies. These companies often charge the charity 20 to 90 cents of each dollar raised. That’s more of your money not going to those protecting you.
• Look at the charity’s finances for yourself. Ask to see a copy of the charity’s annual report or a brochure describing its mission, accomplishments and a current financial statement. You can also request a copy of the organization’s IRS form 990. Federal law requires nonprofit organizations to provide their last 3 IRS form 990s (tax returns) within 30 days of your request. Charity Navigator has detailed analysis of the financial records of many police, firefighters, and veterans groups on our site. The lists below show some of the best and worst police and firefighters, and veterans’ charities that we currently evaluate.

We can be thankful for all who serve.  Yet on this day, we remember our military veterans and those who serve far from home. 

Will charities and non-profit organizations have trouble raising money this year because of the financial crisis?  And if the U.S. falls into a lengthy recession, will that affect next year’s ability to operate non-profit businesses?

Those are questions that NPR recently examined, interviewing many non-profit and corporate represetatives to try and understand how the nation’s economic climate impacts non-profit operating budgets.   If you run a charity or non-profit organization, then you depend on the philanthropy and gift-giving of both individuals and corporations.  In challenging economic times, it’s not surprising that financial donations are reduced.

From an individual perspective, it makes sense.  If you’re struggling with a budget at home, cutting back means a little bit everywhere.  I certainly applaud those who try very hard to keep giving to charity even while they’re struggling financially at home.  One of the keystones to philanthropy in America however is that the greatest amount of financial assistance usually comes from the wealthy and bigger corporations in local communities. 

One example: Washington Mutual Bank, that was taken over by the FDIC and sold to J.P. Morgan used to give over $50 million dollars each year to the local community in the Seattle area to help with homelessness, kids and community outreach.  Will J.P. Morgan continue to provide such enormous charitable donations?  They’re closing over 400 branches and are sure to conduct extensive layoffs.  More importantly, they have little allegiance to the west coast since they’re an east coast bank, formerly the giant investment institution.  It is doubtful that they will consider a similar degree of philanthrophy which is a shame. 

I have another concern.  In recent years, opponents to “globalization” have taken a politically charged viewpoint that large corporations are the enemy, or institutions to be feared.  They have been blamed for everything from global warming, to poverty and to making slaves out of their employees.  And there may be aspects of truth depending upon what part of the world those corporations have operations or factories in.  But demonizing the corporation devalues the positive aspects of what that corporation brings to society, and in my view makes it less likely to achieve necessary reforms.

Many communities are also now realizing is that these large corporation not only are the largest donors from a philanthropic perspective, but that the jobs and services they support have immense value for that community and the state or region in which they are based.  When a company like Washington Mutual goes bankrupt or is sold to another company, all of those relationships change.  And the communities may later suffer without the jobs, services and charitable outreach that once existed.

I believe one of the basic strengths of capitalism begetting jobs growth is the support it provides to people and communities in a myriad of positive ways.  Rather than finding out the hard way how important these corporations are to a local region, we must find a way to balance corporate profits and community conscience.  They are not as bad as anyone might make them out to be, nor are they perfect citizens. But business and corporate development are necessary essentials to growth, and as we are realizing more than ever before, they are essential to a vast array of charitable community services and outreach support.  Let’s work with businesses in our local communities to improve relationships and philanthropic goals, and work with state and local government in order to foster strong business growth. 

Something we must not forget is that in times of great financial challenge it is those at the margin of economic struggle that suffer the most.  Those living in poverty and near the margins of poverty such as the elderly and children are challenged greatly in the best of times, and we must remember to support those organizations and community structures.

When Hurricanes Gustav and Ike roared ashore over the past few weeks the media breathed a sigh of relief that New Orleans was spared.  But the real story is about thousands of people and communities that have lost their homes and business from these monster storms.

We may not see as much media coverage about the aftermath of hurricanes when a major city isn’t involved, but Ike has shown that beachfront communities can be wiped clean off the map.  They’ve got a crisis in south Texas happening right now, and getting food, water and medical care to those folks is the greatest priority.

Many of us cannot help much beyond donating money to a good cause, and with that in mind here are the links to both the American Red Cross Donation page, and another one for the Salvation Army’s donation page.   Both of these organizations provide an essential role in leading relief efforts, and getting food, water and coordinated shelter for people who need it.  Our thoughts and prayers are with them all.

With hurricane Gustav coming ashore in Louisiana today, millions of people have been displaced from their homes across the coastal region.  Although the media has focused on New Orleans, it appears the brunt of the hurricane will be further west to a host of smaller towns and communities.  The hurricane may have been weakened and fortunately not caused as much damage as it could have.  But the damage from hurricane Gustav may still reach beyond $10 billion dollars.

The GOP convention was mostly cancelled for its first day, and instead Mrs. Cindy McCain and Mrs. Laura Bush have spoken about helping those who have been affected by the hurricane and related storm damage. 

There is a “Country First” website called CauseGreater.com that lists various aid agencies by state.  That’s a good start to a political event in a time when many people are worried about their families and homes.   Although the convention will pick up as the week goes on, there are other storms out there, including Hannah that may impact the east coast.

Regardless of one’s politics, it’s nice to see people making the effort to help others.

Inspiration and change takes many forms. As I write this tonight while watching American Idol’s “Idol Gives Back” special, I am astounded to see how quickly we can really help raise financial resources if we really try. It’s only the first hour of Idol Gives Back and they’ve already raised $18 million dollars! Amazing… If you feel you can help, here is the link to the donation page.

What is the Idol Gives Back Foundation?
The IDOL GIVES BACK FOUNDATION is a new U.S. 501(c)(3) charitable organization, working to help young people living in poverty in the U.S. and around the world. The Foundation is teaming up with American Idol to present the second annual star-studded special, Idol Gives Back.

For more information, click here. To view answers to frequently asked questions, click here.

Where will my money go?
Your money will help change and save the lives of children and their families in the U.S. and around the world.

For more information click here.

There are countless millions around the world, and within the U.S. that need our help. We may not be able to do everything, but we can do something. Anything we contribute will help. I’m inspired by American Idol and hope that those who are watching around the world can find a way to contribute too.

A busy April and now May already!  What is it about Spring that seems to foster doing more things… and having more to do!?  I’m a little late writing about it- but like many television viewers, I watched the American Idol charity drive called Idol Gives Back the other week.  I thought Celine Dion and Elvis were incredible!  Apple’s iTunes is even giving proceeds from Idol Gives Back content to the charity through May 23rd.   As of last week, the AP was reporting that Idol Gives Back had raised over $60 million dollars!  You can find a donation form on this page if you are interested!

In his article OPM Chief Defends Charity Campaign, (OPM= Office of Personnel Management) Stephen Barr with the Washington Post is reporting that the agency has relaxed it’s requirement that participating charities spend no more than 25% of their revenue on administrative overhead and fundraising efforts.  This is meeting a great deal of criticism from both political parties, most notably Sen Charles Grassley, a Republican from Iowa.  In effect, critics argue that potential donors will be much more wary of contributing to charities via the campaign.  As someone who contributed via the CFC for many years, I would have to agree.  Every fall the CFC drive kicks off with a great deal of fanfare.  Military and civil service organizations keep a tally on progress goals and many donors give freely with great pride.  And they should!  There are many wonderful organizations that participate in the CFC… but there are also countless others who are looking for a free handout.  When the CFC drive begins, campaign representatives within organizations provide a CFC guidebook or brochure that lists thousands of non-profit entities.  Unless a donor knows who they want to give money to, it’s incredibly difficult to choose- even though the guide book breaks down the percent of money each organization spends on administrative overhead costs.  Sometimes potential donors simply don’t bother… it’s too much to go through.  Other times, they simply give money to the CFC to large groups like the United Way.  I’m a firm believer that non-profit entities eligible for CFC donations should be held to minimum accountability standards in terms of how much they spend on administrative overhead costs.  It would seem 25% is a generous guideline, and would ensure donated money goes to those charitable organizations that use the money most wisely and effectively.  As reported for 2005, CFC contributions by military personnel and federal employees totaled over $268.5 million dollars!   For that amount of money, there should be some minimum standards in place to ensure transparency and effective use of charitable resources.

Well, by me.   I figured since this is my site, that it was most appropriate and symbolic if I make the first donation.  So now there’s a little number “1″ on the charity badge.  I also wanted to verify that it works… it does! Pretty simple and effective.  Nice idea from Six Degrees.  I also thought I would offer the code if anyone likes the OneBack charity badge, and you can put it on your site, or a page somewhere.  You can certainly create one for yourself as well.   So in the months ahead I hope to see a few more donations to the charities.  Spring is just around the corner…  I’m ready for some warmer weather and the chance to get outside more often. Have a great day!

For those who know how, here’s the badge code to place in a blog or web page if desired:

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