Donor Policies and Gift Instructions
GIFT ACCEPTANCE POLICIES OF THE RAY OF HOPE CANCER FOUNDATION
This policy serves as a guideline to members of the Ray of Hope Cancer Foundation (“ROH”) staff involved with accepting gifts, to outside advisors who assist in the gift planning process, and to prospective donors who wish to make gifts to ROH. This policy is intended only as a guide and allows for some flexibility on a case-by-case basis.
II. ADHERANCE TO ETHICAL FUND RAISING PRACTICES
ROH has, among its primary objectives, the task of working with donors to help them make contributions that will satisfy their charitable giving intentions; while keeping in mind that a donor’s financial interests are paramount. ROH and its planned giving office will not support techniques and practices that use undue persuasion upon their donors. Further, representatives of ROH will neither perpetrate any misrepresentation on a donor nor take advantage of any donor’s incapacity or inability to understand fully the nature of any gift they are contemplating.
III. USE OF LEGAL/TAX COUNSEL
All prospective donors will be encouraged to seek their own professional counsel regarding their gift to ROH. They shall also be encouraged to have their own advisors review all proposals and illustrations presented to them. Gift annuity illustrations will always include a disclaimer encouraging the prospective donor to seek independent advice and reminding them of the irrevocable nature of their contribution.
IV. GIFTS OF CASH
Checks and credit card payments shall be made payable to Ray of Hope Cancer Foundation or to a particular program, project or fund at ROH. In no event shall a check be made payable to an individual who represents ROH.
V. PUBLICLY TRADED SECURITIES
- ROH can accept readily marketable securities, such as those traded on a stock exchange.
- Gifted securities are likely to be sold immediately by ROH.
- For ROH gift crediting and accounting purposes, the value of the securities is the average of the high and low on the date of the gift. Wherever possible, ROH staff will provide the most recent 990 and any other related information for the donor.
VI. CLOSELY HELD SECURITIES
- Non-publicly traded securities may be accepted after consultation with the Treasurer’s Office and/or legal counsel.
- Prior to acceptance, ROH shall explore methods of liquidation for the securities through redemption or sale. A representative of ROH shall try to contact the closely held corporation to determine whether there are any restrictions on transfer.
VII. REAL ESTATE
- Gifts of real estate must be reviewed by the Gift Review Committee ROH before acceptance. The Gift Review Committee shall be comprised of the Board Treasurer, Executive Director, and/or Board. Once a prospective gift has been reviewed, a recommendation can then be made to whether to ultimately accept or decline the offer.
- In most cases, the donor is responsible for obtaining an appraisal of the property. The cost of the appraisal is borne by the donor.
- Prior to presentation to the Gift Review Committee, a member of the staff must conduct a visual inspection of the property wherever possible. If the property is located in a geographically isolated area, a local real estate broker can substitute for a member of the staff in conducting the visual inspection.
- Prior to presentation to the Gift Review Committee, the donor must provide the following documents:
- Real estate deed,
• Real estate tax bill,
• Plot plan, and
• Substantiation of zoning status
- Depending on the value and desirability of the gift: An estimate of fair market value the donor’s connection with ROH, and the donor’s past gift record, the donor may be asked to pay for all or a portion of the following:
- Maintenance costs
- Real estate taxes
- Real estate broker’s commission and other costs of sale
- Appraisal costs
- For ROH’s gift crediting and accounting purposes, the value of the gift is the appraised value of the real estate. (Note: A nonprofit can choose to exclude from the value of the gift costs for maintenance, insurance, real estate taxes, broker’s commission, and other expenses of sale.)
VIII. LIFE INSURANCE
- ROH will accept life insurance policies as gifts only when ROH is named as the sole owner and 100% beneficiary of the policy.
- If the policy is a paid-up policy, the value of the gift for ROH’s gift crediting and accounting purposes is the policy’s replacement cost.
- If the policy is partially paid-up, the value of the gift for ROH’s gift crediting and accounting purposes is the policy’s cash surrender value. (Note: For IRS purposes, the donor’s charitable income tax deduction is equal to the interpolated terminal reserve, which is an amount slightly in excess of the cash surrender value.)
IX. TANGIBLE PERSONAL PROPERTY
- Gifts of tangible personal property to ROH should have a use related to ROH’s exempt purpose.
- Gifts of jewelry, artwork, collections, equipment, and software shall be accepted after approval by the Gift Review Committee.
- Such gifts of tangible personal property defined above shall be used by or sold for the benefit of ROH.
- No property that requires special display facilities or security measures shall be accepted by ROH without consultation with the Gift Review and/or Development Committees of the Board of Directors.
- Depending upon the anticipated value of the gift, ROH shall have a qualified outside appraiser value the gift before accepting it.
- ROH adheres to all IRS requirements related to disposing gifts of tangible personal property and filing appropriate forms.
X. PLANNED GIFTS
ROH offers the following planned gift options:
- Charitable gift annuities
a. Deferred gift annuities
b. Charitable remainder trusts
a. Retained life estates
- Charitable Gift Annuities
a. Administrative fees shall be paid from the income earned on the charitable gift annuity.
- There shall be no more than two beneficiaries on a charitable gift annuity.
- The minimum gift accepted to establish a charitable gift annuity is $1,000.
- No primary income beneficiary for a charitable gift annuity shall be younger than 55 years of age.
- Deferred Gift Annuities
- Administrative fees shall be paid from the income earned on the charitable gift
- There shall be no more than two beneficiaries on a deferred gift annuity.
- The minimum gift accepted to establish a deferred gift annuity is $5,000.
- No income beneficiary for a deferred gift annuity shall be younger than 30 years old.
- ROH sets a rate scale for the charitable gift annuities that they offer based on consultation with their Financial Advisor, Executive Director, and/or Board. Recommendations are then made to the Board for review & approval.
- Charitable Remainder Trusts
- Management fees for the administration of a charitable remainder trust when ROH is named as trustee or co-trustee shall be paid from the income of the trust.
- Investment of a charitable remainder trust shall be determined by the fiduciary hired to manage the trust. No representations shall be made by a ROH employee or person acting on behalf of ROH as to the management or investment of such charitable remainder trust.
- The payout rate of a charitable remainder trust shall be determined in consultation with the donor and ROH investment advisor. By law, the payout rate cannot be lower than 5%. The payout rate shall be negotiated between the donor and ROH and shall reflect the number of beneficiaries, their ages, and the size of the trust.
a. Assets transferred through bequests that have immediate value to ROH, or can be liquidated, shall be encouraged by the development staff. Gifts that appear to require more cost than benefit shall be discouraged or rejected.
- Donors who have indicated that they have made a bequest to ROH may, depending upon the individual situation, be asked to disclose in writing or provide copy of the will. We will request at least the relevant clause that benefits ROH as evidence of their gift. This information is used for internal financial purposes and is not binding on the donor. The information shall always be kept in the strictest confidence.
XI. ADMINISTRATIVE ISSUES
- ROH shall not act as an executor (personal representative) for a donor’s estate.
- ROH may act as co-trustee on a charitable remainder trust, when the trust names ROH as a beneficiary of 50% or more of the trust.
- ROH will pay for the drafting of legal documents for a charitable remainder trust when ROH is named as a beneficiary of 50% or more of the trust. The donor’s own counsel should review the documents at the donor’s cost.