Podcast
Questions and Answers
Which of the following planned giving approaches typically does not result in current dollars?
Which of the following planned giving approaches typically does not result in current dollars?
- Gifts of life insurance
- Charitable remainder trust
- Charitable lead trust
- Bequests in wills (correct)
What is a common characteristic of charitable lead trusts and charitable remainder trusts?
What is a common characteristic of charitable lead trusts and charitable remainder trusts?
- They are always revocable
- They can result in current dollars (correct)
- They are typically realized after the donor's death
- They are examples of current giving
According to Hopkins (2017), what is the relevance of the page number 304 in the context of planned giving?
According to Hopkins (2017), what is the relevance of the page number 304 in the context of planned giving?
- It is the page number where the definition of planned giving is provided
- It is the page number where the difference between bequests in wills and other planned giving approaches is explained (correct)
- It is the page number where the author discusses the tax benefits of charitable donations
- It is the page number where the importance of current giving is stressed
What is the primary reason why bequests in wills are not considered a source of current dollars?
What is the primary reason why bequests in wills are not considered a source of current dollars?
Which of the following statements about planned giving approaches is accurate?
Which of the following statements about planned giving approaches is accurate?
What is the primary reason why a sole proprietorship is not a viable business structure for a for-profit subsidiary of a tax-exempt organization?
What is the primary reason why a sole proprietorship is not a viable business structure for a for-profit subsidiary of a tax-exempt organization?
Which of the following business structures is suitable for a for-profit subsidiary of a tax-exempt organization?
Which of the following business structures is suitable for a for-profit subsidiary of a tax-exempt organization?
Why would a tax-exempt organization choose to establish a for-profit subsidiary?
Why would a tax-exempt organization choose to establish a for-profit subsidiary?
What is the primary advantage of establishing a separate corporation for a for-profit subsidiary of a tax-exempt organization?
What is the primary advantage of establishing a separate corporation for a for-profit subsidiary of a tax-exempt organization?
Which of the following is a characteristic of a for-profit subsidiary of a tax-exempt organization?
Which of the following is a characteristic of a for-profit subsidiary of a tax-exempt organization?
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Study Notes
Planned Giving Approaches
- Charitable lead trusts provide present dollars through planned giving.
- Charitable remainder trusts are a type of planned giving that can result in current dollars.
- Gifts of life insurance are a planned giving approach that can generate current dollars.
- Bequests in wills do not produce current dollars as they are realized after the donor's death.
Business Structure for a For-Profit Subsidiary
- A for-profit subsidiary of a tax-exempt organization cannot be a sole proprietorship.
- This is because a sole proprietorship would require the tax-exempt organization to handle business operations directly, negating the benefit of having a separate corporation.
- Viable business structures for a for-profit subsidiary of a tax-exempt organization include:
- C Corporation
- Limited Liability Company (LLC)
- S Corporation
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