10 Questions
Which of the following planned giving approaches typically does not result in current dollars?
Bequests in wills
What is a common characteristic of charitable lead trusts and charitable remainder trusts?
They can result in current dollars
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 difference between bequests in wills and other planned giving approaches is explained
What is the primary reason why bequests in wills are not considered a source of current dollars?
They are typically realized after the donor's death
Which of the following statements about planned giving approaches is accurate?
Charitable lead trusts, charitable remainder trusts, and gifts of life insurance are examples of planned giving that can result in current dollars
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?
It would require the tax-exempt organization to handle business operations directly
Which of the following business structures is suitable for a for-profit subsidiary of a tax-exempt organization?
C Corporation
Why would a tax-exempt organization choose to establish a for-profit subsidiary?
To provide limited liability protection
What is the primary advantage of establishing a separate corporation for a for-profit subsidiary of a tax-exempt organization?
Limited liability protection
Which of the following is a characteristic of a for-profit subsidiary of a tax-exempt organization?
It provides limited liability protection to the parent organization
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
Learn about different planned giving approaches, including charitable lead trusts, charitable remainder trusts, gifts of life insurance, and bequests in wills. Understand how they generate current or future dollars.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
