Preamble
The purpose of
this statement is to encourage responsible gift planning by
urging the adoption of the following Standards of Practice
by all individuals who work in the charitable gift planning
process, gift planning officers, fund raising consultants,
attorneys, accountants, financial planners, life insurance
agents and other financial services professionals
(collectively referred to hereafter as “Gift Planners”), and
by the institutions that these persons represent.
This statement
recognizes that the solicitation, planning and
administration of a charitable gift is a complex process
involving philanthropic, personal, financial, and tax
considerations, and often involves professionals from
various disciplines whose goals should include working
together to structure a gift that achieves a fair and proper
balance between the interests of the donor and the purposes
of the charitable institution.
I. Primacy
of Philanthropic Motivation
The principal
basis for making a charitable gift should be a desire on the
part of the donor to support the work of charitable
institutions.
II.
Explanation of Tax Implications
Congress has
provided tax incentives for charitable giving, and the
emphasis in this statement on philanthropic motivation in no
way minimizes the necessity and appropriateness of a full
and accurate explanation by the Gift Planner of those
incentives and their implications.
III. Full
Disclosure
It is essential
to the gift planning process that the role and relationships
of all parties involved, including how and by whom each is
compensated, be fully disclosed to the donor. A Gift Planner
shall not act or purport to act as a representative of any
charity without the express knowledge and approval of the
charity, and shall not, while employed by the charity, act
or purport to act as a representative of the donor, without
the express consent of both the charity and the donor.
IV.
Compensation
Compensation
paid to Gift Planners shall be reasonable and proportionate
to the services provided. Payment of finder’s fees,
commissions or other fees by a donee organization to an
independent Gift Planner as a condition for the delivery of
a gift is never appropriate. Such payments lead to abusive
practices and may violate certain state and federal
regulations. Likewise, commission-based compensation for
Gift Planners who are employed by a charitable institution
is never appropriate.
V.
Competence and Professionalism
The Gift Planner
should strive to achieve and maintain a high degree of
competence in his or her chosen area, and shall advise
donors only in areas in which he or she is professionally
qualified. It is a hallmark of professionalism for Gift
Planners that they realize when they have reached the limits
of their knowledge and expertise, and as a result, should
include other professionals in the process. Such
relationships should be characterized by courtesy, tact and
mutual respect.
VI.
Consultation with Independent Advisers
A Gift Planner
acting on behalf of a charity shall in all cases strongly
encourage the donor to discuss the proposed gift with
competent independent legal and tax advisers of the donor’s
choice.
VII.
Consultation with Charities
Although Gift
Planners frequently and properly counsel donors concerning
specific charitable gifts without the prior knowledge or
approval of the donee organization, the Gift Planner, in
order to insure that the gift will accomplish the donor’s
objectives, should encourage the donor early in the gift
planning process, to discuss the proposed gift with the
charity to whom the gift is to be made. In cases where the
donor desires anonymity, the Gift Planner shall endeavor, on
behalf of the undisclosed donor, to obtain the charity’s
input in the gift planning process.
VIII.
Description and Representation of Gift
The Gift Planner
shall make every effort to assure that the donor receives a
full description and an accurate representation of all
aspects of any proposed charitable gift plan. The
consequences for the charity, the donor and, where
applicable, the donor’s family, should be apparent, and the
assumptions underlying any financial illustrations should be
realistic.
IX. Full
Compliance
A Gift Planner
shall fully comply with and shall encourage other parties in
the gift planning process to fully comply with both the
letter and spirit of all applicable federal and state laws
and regulations.
X. Public
Trust
Gift Planners
shall, in all dealings with donors, institutions and other
professionals, act with fairness, honesty, integrity and
openness. Except for compensation received for services, the
terms of which have been disclosed to the donor, they shall
have no vested interest that could result in personal gain.
Adopted and
subscribed to by the National Committee on Planned Giving
and the American Council on Gift Annuities, May 7, 1991.
Revised April 1999. Reprinted with permission. |
