XXIX. POLICY ON PRIVATE FUNDRAISING
The
purpose of the Virginia Western Community College Educational Foundation, Inc.
is to:
·
Enhance
the community’s awareness of the college
·
Secure
funding for scholarships, faculty development and capital projects
·
Provide
prudent fiscal management of monies and properties submitted to the Foundation
All donations to the
College should be made in the name of the Virginia Western Community College
Educational Foundation, Inc. Please advise donors that their gifts are
tax-deductible, within the limits of the IRS regulations, and that they will
receive an official gift receipt letter from the Foundation office on receipt
of their gift. Note: The VWCC Educational Foundation is 501(c) 3,
not-for-profit, charitable organization.
Options for Giving
Cash
Cash is always an
easy option. When a donor gives a cash gift to the Virginia Western Educational
Foundation, his/her out-of-pocket cost may be less than the amount of the gift
because of the income tax deduction allowed. Keep in mind, actual savings from
the tax deduction will vary due to a donor’s tax rate and other factors.
Generally, the higher a donor’s tax rate, the greater the savings!
Stock
A donor may find it more advantageous to give a gift in stock - especially appreciated securities - instead of cash, because he/she can save on income and capital gains taxes. Current tax laws make it possible for a donor to contribute a charitable gift of stock at a remarkably low after-tax cost. The donor pays no capital gains tax upon the transfer of stock to the Virginia Western Educational Foundation. The donor also receives an income tax charitable deduction for the full fair market value of the stock on the date of the gift (assuming the donor has held the stock for longer than twelve months). For regularly traded stocks, the charitable deduction is determined by using the average of the high and low price on the date of the gift.
Personal Property
Gifts of real estate, equipment, artwork, books, and other non-cash items are considered gifts of personal property. The donor’s deduction will depend on the appraised value and how Virginia Western will use the item.
Gifts through a Will
A donor can specify
an outright gift of cash, securities, real estate, or tangible property to the
Educational Foundation in his/her will. A bequest will reduce possible
estate taxes and leave a lasting legacy that underscores the donor’s commitment
to educational opportunities for our community’s students and workforce.
The donor should simply show the following statement to an attorney who can
adapt it to best suit the donor’s needs:
“I
give and bequeath to the Directors of the Virginia Western Community College
Educational Foundation, Inc. the sum of ___ Dollars ($___) (or percentage
of estate) for the use and benefit of
Charitable Remainder
Trusts
Tax
laws encourage gifts which enable the donor to make a meaningful gift and at
the same time continue to receive income from contributed assets.
Charitable remainder trusts are often called “deferred” because, while they
produce immediate tax savings and income benefits to the donor, the underlying
assets contributed are not available for charitable purposes until the trust
ends, either at death, or after a term of years stated in the trust. The
main advantage to such gifts is the ability to avoid capital gains tax on
appreciated assets, to shelter current income with tax deductions, and, often,
to increase after-tax spendable income. They can help to lessen the
donor’s taxable estate, reduce probate costs, and, ultimately, support Virginia
Western.
Charitable Lead
Trusts
The
tax laws also encourage gifts that help pass assets to heirs with significantly
reduced gift and estate tax consequences. Known as charitable lead
trusts, they can be structured to produce a regular stream of payments to
support Virginia Western for a number of years; freeze asset value for tax
purposes, producing discounted gift tax liability; pass subsequent appreciation
in the transferred assets to heirs entirely free of tax; and preserve
income-producing assets for younger generations. Such trusts can be
established during a donor’s life, or through the donor’s estate. Either
way, they can help lessen estate tax consequences and reduce probate costs.
Designation of a
Balance for a Retirement Plan
Retirement
plans such as IRAs, 401(k)s, 403(b)s, etc. are taxed at death like no other
asset, paying both the income tax and the estate tax. These combined
taxes can take more than half the value of a donor’s account. If the
donor chooses to direct part or his/her entire unused retirement plan to the
Educational Foundation the donor will avoid both taxes, and reduce the cost of
the gift significantly. To include the Educational Foundation in the
disposition of the donor’s final account balance, the donor should simply
contact the manager of his/her retirement plan for assistance.
Designation of Life
Insurance Policy
Making
the Educational Foundation the beneficiary of a term life policy will provide a
gift at the donor’s death, if the policy is kept in force, or can be
contributed during the donor’s lifetime if it is a policy the donor owns, but
no longer needs. Giving a policy with a cash value provides an immediate
gift to Virginia Western, as well as a charitable income tax deduction for the
donor or the donor’s estate.
For
more information on these and other opportunities, please contact the
Foundation.
Virginia
Western Educational Foundation, Inc.
Policies
and Procedures for Fund Raising
By VWCC
Faculty, Staff and Organizations
The purpose of the Virginia Western Community
College Educational Foundation, Inc. (the Foundation) is to support the
college’s mission by securing funds for scholarships, faculty development and
capital projects; enhancing the community’s awareness of the college; and
providing prudent fiscal management of monies and properties submitted to the
Foundation.
While the Foundation encourages faculty,
staff and organizations to seek money, items, or services from the community
that will improve the college it is important to note that asking the public to
support Virginia Western requires an orchestrated effort on all of our
parts. For instance, before you approach
your potential contributor you need to know if someone else at Virginia Western
has already approached them for a different project. Soliciting a potential donor for two or more
different efforts will immediately produce a negative donor response. By making the Foundation aware of your plans,
we will be able to coordinate all of the various fund raising efforts, and
assist you personally to ensure that your efforts are successful. Additionally, the Foundation has a different
tax status than the college. This means
that donors may receive a tax write-off for their donation. This is a very attractive and persuasive
opportunity for the donor.
Before
engaging in a fundraising effort please note and comply with the following:
1.
Please complete the
following “Fund Raising Proposal” form and send it to the Virginia Western
Community College Educational Foundation, Inc. before beginning a fund raising
effort. Once your effort is finished,
please complete and send in the bottom portion of the form.
2.
The Foundation staff
will assist any faculty, staff, students and/or organizations with their fund
raising efforts.
3.
Any gift received
must fit within the guidelines of Virginia Western’s Gift Acceptance Policy on
the pages following the proposal form.
4.
All donations should
be made in the name of the Foundation.
Please advise donors that their gifts are tax-deductible, within the
limits of the IRS regulations, and that they will receive an official gift
receipt letter from the Virginia Western Educational Foundation, Inc. upon
receipt of their gift. (Note: The VWCC Educational Foundation is 501(c)3
not-for-profit organization and the tax identification number is 52-1200913).
Approved ___________________________________ Date _______________________
Fund Raising
Proposal
Please complete
the top portion of form, and send to VWCC Educational Foundation, Inc. office
before beginning a fund raising effort.
Submitted by: _________________________________ Date:
Department: _________________________________ Phone Number:
What are you raising money for?
How much money or what item(s) do you need?
_________________________________
When will you be fund raising? Beginning: _____________ Ending:
Which individuals, companies, organizations, and/or
foundations will you approach?
_____________________________________(please
attach separate sheet if necessary)
Signature of Applicant: _______________________________ Date:
Signature of Supervisor: _______________________________ Date:
Signature of Development Officer: ____________________ Date:
Fund Raising Results
Please complete
the bottom portion of form, and send to VWCC Educational Foundation, Inc.
office after the fund raising effort
is complete.
Total money donated: ___________________________ Date:
Item(s) donated and value:
_____________________________________(please
attach separate sheet if necessary)
Donor(s) and Solicitor(s):
___________________________________________________
_____________________________________(please
attach separate sheet if necessary)
__ Contribution acknowledged and received by the VWCC
Educational Foundation, Inc.
__ Fund Raising effort cancelled. Reason:
VIRGINIA WESTERN COMMUNITY COLLEGE
EDUCATIONAL FOUNDATION
Gift Acceptance and Reporting Policy
Standards
for Reporting Certain Types of Gifts and Pledges
Cash
Report cash at full value as of the date
received.
Pledges
Pledges are signed statements of intent,
which will be recorded and included in contribution totals. In order for a pledge to be counted, it must
contain predetermined payment dates and amounts.
Verbal Pledges
Verbal pledges should not be reported in
contribution totals. On the rare
occasion when special circumstances may warrant making an exception, the development
officer may write to the individual making the verbal pledge to document the
commitment, place a copy of the letter in the donor’s file, and gain specific
written approval from the Foundation Board of Directors to count it among the
contribution totals.
Marketable Securities
The value of marketable securities will be
determined by the average of the high and low quoted selling prices (or the
average of the bid/ask in the case of certain securities) on the date the donor
relinquishes dominion and control of the assets in favor of the
Foundation. Exactly when a donor has
relinquished dominion and control depends upon the method of delivery of the
securities to the Foundation (including the electronic transfer of stock). IRS regulations should be consulted in each
case to determine the most advantageous arrangement for the donor.
Closely Held Stock
Gifts of closely held stock exceeding $10,000
in value should be reported at the fair-market value placed on them by a
qualified independent appraiser as required by the IRS for valuing gifts of
non-publicly traded stock. Gifts of
$10,000 or less may be valued at the per-share cash purchase price of the most
recent transaction. Normally, this
transaction will be the redemption of the stock by the corporation. If no redemption has occurred for a gift of
$10,000 or less, an independent CPA who maintained the books of a closely help
corporation is deemed to be qualified to value the stock of the corporation.
Gifts of Non-Monetary Items
Non-monetary Gifts must be reviewed with
special care to ensure that acceptance will not involve financial commitments
in excess of budgeted items or other obligations disproportionate to the
usefulness of the gift. Consideration
should be given to the cost of maintenance, cataloging, delivery, insurance,
display, and any space requirements for exhibiting or storage. All gifts of real estate or unusual items of
questionable value must be presented to, and approved by the Foundation’s Board
of Directors prior to acceptance.
All non-monetary gifts are regularly reported
to the Foundation Office and College’s Business Office, and are officially
acknowledged in the same manner as cash or other contributions. Caution should be exercised to ensure that
only gifts that are convertible to cash or that are of actual value to the
Foundation and/or College are included in contribution totals.
Gifts of non-monetary items generally can be
regarded in one of three ways:
Gifts-In-Kind
– Donated tangible and intangible assets and property such as real estate,
notes, mortgages, limited partnership interests, royalty or copyright
interests, art, books, equipment, automobiles, inventory, personal property,
and other physical assets or materials which represent value.
Gifts of real and
personal property for which donors qualify for charitable deductions will be
counted at their full fair-market value.
The Foundation cannot establish monetary value for gifts-in-kind
according to the IRS. The donor, if a
value is needed for income tax purposes, must provide in writing the commercial
value of the object(s) given. Gifts with
fair-market values exceeding $5,000 should be counted at the values placed on
them by a qualified independent appraiser.
Gifts valued at $5,000 or less may be reported at the values declared by
the donor or placed on them by a qualified expert.
Arrangements will
be made during preliminary discussions or correspondence about delivery of
gifts-in-kind directly to the Foundation.
Arrangements also include agreement with the donor regarding costs of
packing, freight charges, etc., usually the responsibility of the donor.
Services
– This term includes professional or personal services or time which are freely
given and which easily can be valued by their usual market cost. Gifts of services may be recognized by the
organization, but are generally not recognized by the IRS as being tax
deductible. Examples of gifts of
services are the donation of broadcast time by a radio station or legal
services by an attorney.
Limited Use of Private Property
– The right to rent-free use of a home, office, piece of equipment or
commercial property owned by a donor for a specific event for a specified
period of time. Such gifts are only occasionally recognized by the Virginia
Western Community College Foundation, but are generally not recognized by the
IRS as being tax deductible. Examples
include the rent-free use of office space, or the rent-free use of a vacation
home to host an event.
Remainder Interest in a Residence or Farm
A gift of a remainder interest in a personal residence or
farm will be recorded with the “expectancy commitments” at both the remainder
value recognized as an allowable deduction by the IRS and at the face value.
Irrevocable Deferred Gifts (Life Income Gifts)
Irrevocable deferred gifts will be counted at fair-market
value which is defined as the full amount of the asset used to fund the gift if
the donor is 50 years of age or older.
Irrevocable deferred gifts include:
Charitable
Remainder Trusts – To fund a charitable remainder
trust a donor gives stock, cash, or other assets. Those assets are invested, producing income
for the donor, or beneficiaries designated by the donor, either for a fixed
period of time or until the final beneficiary’s death. The donor is allowed to claim a tax deduction
for the estimated portion of the assets that will ultimately go to
charity. When the payments to the donor
or designated beneficiaries end, the charity keeps all the remaining assets. There are two types of charitable remainder
trusts: an annuity trust and unitrust.
While a charitable remainder annuity trust provides a fixed amount of
income determined at the creation of the trust, the unitrust pays a percentage
of the trust assets as valued annually.
Charitable Gift
Annuities – Gifts made in exchange for an annuity are
technically outright gifts subject to a condition that the charity pay a fixed
dollar amount for life or lives of one or more annuitants. It is backed by all of the assets of the
charity. The pay can start immediately,
or can be deferred for a year or more.
There is no “remainder interest.”
However, because the charity receives less than the entire amount
transferred – only the excess of the gifted value over the cost of producing
the annuity – gift annuities will be reported among the other irrevocable
deferred gifts.
Pooled Income Funds
– In a pooled income fund, the donor gives cash, securities, or other assets to
a charity, which then invests those assets in a large, diversified
portfolio. The donor receives income
from the fund proportionate to the value of his or her contribution, as well as
an income-tax deduction based on the estimated principal that will be left to
the charity. Obtaining a “unit” in a pooled
income fund is similar to buying a share in a mutual fund.
Charitable Lead Trusts
With a charitable lead trust, the charity
receives the income from the donor’s assets for a specified time, after which
the asset is transferred back to the donor or to the donor’s heirs. Only the income received from a charitable
lead trust will counted as it is received by the Foundation.
Wholly Charitable Trusts Administered by Others
A wholly charitable trust is one that is held
for the benefit of charity, where the principal is invested and the income is
distributed to charitable organizations.
All interests in income and principal are irrevocably dedicated to
charitable purposes (as opposed to charitable remainder or lead trusts). While it is similar in that sense to an
endowment fund, it is created as a freestanding entity.
The fair-market value of the assets, or a
portion of the assets, of such a trust administered by an outside fiduciary
should be counted in the “gifts and pledges” section of the contribution totals
for the year in which the trust is established, provided that the Foundation
has an irrevocable right to all or a predetermined portion of the income of the
trust.
The amount to be reported, in cases where
less than the entire income of the trust is to be distributed to the
Foundation, is the amount of the income to be distributed to the Foundation
over the total income (or the stated percentage to be distributed, if the trust
terms spell this out as a percentage) multiplied by the value of the trust
assets. The income of the trust is
thereafter treated as endowment income and does not appear in the amounts
reported under gifts.
Life Insurance
The Foundation must be named both beneficiary
and irrevocable owner of a life insurance policy before a policy can be
recorded as a gift. The Foundation will
count the cash surrender value of the policy if the donor is 50 years of age or
older. Donors will be acknowledged for
the face value of the policy. Premiums
paid on the policy will be counted as contributions.
Testamentary Pledge Commitments and Revocable Trusts
A pledge in the form of a testamentary
commitment will be counted if the donor is 60 years of age or older. The pledge must be documented by a photocopy
of the pertinent portion of the will, trust document, or insurance policy,
and/or a letter describing the commitment and its ultimate financial value to
the organization, preferably from the donor’s attorney or financial
planner. Such pledges will be recorded
as “expectancy commitments” and will be recorded separately from pledge
commitments, which are to be paid on a predetermined pledge schedule.
Non-Government Grants
Grant income from private, non-government
sources will be reported if the grant was intended for the Foundation.
Local, State and Federal Government
Public money that is specifically allocated
to the Foundation will be counted in the contribution totals.
Matching Gifts
For the purposes of determining the donor’s
eligibility for named funds, gifts from businesses that match voluntary
contributions of the donor will be counted as part of the total gift.
Special Circumstances
Any circumstances regarding the accepting and
recording of gifts not covered in these guidelines will be resolved in a manner
consistent with the standards recommended in the 1994 by the Council for
Advancement and Support of Education (CASE), and approved by the Board of
Directors of the Virginia Western Community College Educational Foundation,
Inc. Exceptions to the above stated
policies must be approved by the Foundation’s Board of Directors and made
through action of the Executive Committee.
Exclusions
The following types of monies will be
excluded from the reporting of the Foundation’s contribution totals:
1.
investment earnings on gifts;
2.
earned income;
3.
contract revenues;
4.
Government funding (Funds pledged by governments, which are
specifically earmarked for the Foundation will be counted in the contributions
total.)
March 25,
2000, by the Board of Directors of the Virginia Western Community
College
Educational Foundation, Inc.
Revisions
approved: June 12, 2003, by the
Board of Directors of the Virginia Western Community
College Educational Foundation, Inc.