The Wichita Community Foundation is here to help your clients reach their charitable goals. We are experienced partners in philanthropy.
How the Foundation can help your client
Do you have clients who care deeply about charitable causes?
Do they give annually to more than one charity?
Are they interested in creating a personal legacy?
Are they considering creating a private foundation?
Do they want to stay involved in making charitable gifts?
Do they need and want maximum tax benefits for their charitable contributions?
Is sound financial management of their contributions a priority?
If the answer is yes to any of these questions, your clients would benefit from learning more about the Wichita Community Foundation. Good charitable advice strengthens the client relationship by providing better service to the client and generating greater loyalty, and clients expect referrals to experts in charity, just as they would with other specialties like accounting or law. And high-quality charitable planning can meet multiple goals, and result in a larger benefit to family members.
Although the Foundation is a public charity, it does not promote one charitable cause. Instead, its mission is to build and hold endowments and other charitable funds to provide for Wichita’s changing needs. Since 1986 the Wichita Community Foundation has and continues to be a trusted partner in philanthropy. Through this unique mission, the Foundation can help your clients achieve their goals.
The following pages in this section detail how we can help you help your client. In preparing them, we consulted with top local financial advisors and estate planning attorneys. We want to make it easy for you to find answers to your questions. We pride ourselves on providing simple solutions to help your client achieve their charitable goals.
If we missed providing a piece of information you need, please email Carol Nazar, Director of Donor & Grant Making Services at cnazar@wichitacf.org and we’ll add it to this page.
Key Advantages for the Donor
SIMPLE – At the Wichita Community Foundation, funds are created with a clearly stated two page template. This language can be easily adapted to express your client’s charitable wishes and give them security concerning their legacy. A fund can be established with as little as $10,000. As the donor, your client can take an active or passive role in subsequent grant making from the fund. The Foundation handles the investments, the IRS reporting, the audit and continuing compliance with changing federal laws.
EVOLVING – The needs of a community change over time. One hundred years ago Wichita was an agricultural town and its mayor dreamed of creating a public park system for all to enjoy. Today Wichita’s mayor dreams of a vibrant city center, increased job opportunities and feeding hungry children caught in poverty. The Foundation is here for the donors and the city it was created to serve. We understand local issues, value local leaders, and we know how to bring different segments of the community together to solve problems. Whatever the scope of your client’s charitable legacy, local or national, we can see it through, into the future.
EFFICIENT – The community foundation “model” is extremely cost efficient for your clients. As a public charity the Foundation offers the highest level of tax benefit available to donors. A fund with the Wichita Community Foundation pays no tax on investment income, and is covered under the Foundation's Tax Return (Form 990) and annual audit. Management fees range from 1 to 2% depending on the type of fund selected. These dollars support the work of the Foundation which benefits the entire community.
SECURE – Trust is earned. The core values of the Foundation center on confidentiality and accountability to our donors. If your client is dealing with a difficult family situation regarding future charitable giving, we can assume the role of intermediary, carrying out his or her wishes in perpetuity. Conversely, if your client wishes to name his or her children as successor trustees to their fund, we will assist them in their charitable giving. Or perhaps your client has a unique idea for an estate gift, one that requires continuing oversight. With a fund at the Foundation, his or her legacy will be protected and executed into the future.
Investment Options
At the Wichita Community Foundation, we feel it is important to find the right fit for our donors’ needs. Working with the recommendations of our consultant, the Fund Evaluation Group and our locally-based Investment Committee, we offer a variety of investment options and strategies, designed for different levels of risk tolerance and investment time horizons, so that each donor can meet his or her unique charitable objectives.
Investment Pools
The Wichita Community Foundation has created four distinct pools of funds, each based on a specific investment strategy. Each donor will be asked to pick a pool when establishing their Fund and should review the options carefully. Learn More >
WCF Investment History
Objectives: The primary investment objective of the Foundation is to achieve an annualized total return (net of fees and expenses), through appreciation and income, equal to or greater than the rate of inflation (as measured by the broad, domestic Consumer Price Index) plus any spending and administrative expenses thus, at a minimum maintaining the purchasing power of the Foundation. The assets are to be managed in a manner that will meet the primary investment objective, while at the same time attempting to limit volatility in year to - year spending.
Spending Policy
As adopted by the Board on June 23, 2010, the spending policy of the Foundation is as follows:
Effective July 1, 2008, unless the Instrument of Gift, Fund Agreement or other instrument creating an endowment Fund specifically provides otherwise, annual grant distribution(s) from each endowment Fund will be based on four percent (4%) of a three year moving average of endowment Fund market values determined at the end of the fiscal year before the year in which distribution is to be made; except that the Foundation’s Board of Directors may, in its absolute discretion, due to unusual or extraordinary circumstances, designate some other amount for the Foundation to appropriate for expenditure or accumulate in any Fund. Neither KSA 58-3614(a) nor any similar statute or rule of law shall apply, and KSA 58-3614(b) and (c) shall be applied by substituting ‘under the Foundation’s spending policy’ for ‘under subsection (a).’ The Board may amend this Policy at any time, and the Policy, as so amended, shall then apply to all endowment Funds, whether created before or after such amendment. This Policy shall apply to endowment Funds existing on July 1, 2008, as well as to Funds thereafter created.
Schedule of Asset and Style Allocation
Picking an Investment Option
As a professional, you know and understand your client’s ultimate charitable goals. The staff of the Wichita Community Foundation is experienced in working with business professionals in the Wichita area. At your request, we are ready to help you position your client to achieve philanthropic success for the long term.
Types of Funds
Our mission statement says it all - we’re flexible. Here’s a listing of the types of funds we offer.
Types of Giving Opportunities
Gifts of Property
Real Estate
Kansas is rich in land. A recent study commissioned by the Kansas Health Foundation highlights a predicted transfer of wealth that will occur during the next decade, largely based in the value of land. The Wichita Community Foundation can accept a gift of a house or other personal residence, farm, commercial buildings, income-producing or non-income-producing land.
If someone anticipates making a bequest of property to the Wichita Community Foundation, it would be advisable to first obtain the consent of WCF’s Fund Acceptance Committee to review the conditions of gifting the property before a will or other legal document is drafted. Since the prospective donor is probably expecting a large estate tax charitable contribution deduction from his or her gift, there could be problems if, after the death of the donor, WCF first learns of the bequest and rejects the property as unsuitable.
WCF typically works with a prospective donor’s professional advisor to explore the costs associated with gifted property. There is usually an understanding the donor will contribute sufficient cash to cover maintenance costs. If the property could have contingent liabilities, such as environmental clean-up costs, then the donor should warrant that the property is free from such liabilities and will agree to pay such costs if they arise in the future. In some cases, it would be appropriate to incur investigative costs (such as surveys or sampling for environmental contamination) at the donor’s expense, before accepting the property. It is very common for purchasers, lenders and even charities to insist on a Phase One audit before acquiring property.
Publicly Traded Securities
Donating appreciated securities often allows donors to make a bigger philanthropic impact and enjoy greater tax advantages than donating cash or selling the stock and donating the proceeds. The Wichita Community Foundation offers expertise in even the most complicated charitable transactions, from publicly traded securities to shares in S corps or privately held securities. By donating appreciated securities, you bypass capital gains tax and may deduct the fair market value of your gift.
A gift of publicly traded stock, bonds and mutual funds can be used to establish or add to a fund. Appreciated securities held long-term often provide important tax advantages, as their full market value is generally deductible as a charitable contribution up to 30 percent of the donor’s adjusted gross income. Like gifts of cash, deduction amounts that exceed the limit can be carried forward for up to five additional years.
For publicly traded securities held for more than one year, the deduction is the mean of the high and low prices reported on the date the contribution is received by the Wichita Community Foundation. For mutual fund shares held for more than one year, the deduction is the closing price on the date the contribution is received. For securities or mutual fund shares held for one year or less, the deduction is the lesser of the cost basis or fair market value.
Securities can be gifted in two ways:
Closely Held Securities
Closely-held stock, S-Corp stock, interests in limited liability companies and many types of partnership interests can also be gifted. As with publicly traded securities, the donor is able to deduct up to 30 percent of the donor’s adjusted gross income based on the fair market value of the stock. These types of gifts are somewhat more complicated because the security interests are often subject to restrictions imposed by the business entity, and because valuation of these closely-held interests is not as readily apparent as with publicly-traded securities. The donor will be required to provide the IRS with a qualified appraisal for any contributed property for which the donor will claim a deduction of more than $5,000. For securities held for one year or less, the deduction is the lesser of the cost basis or fair market value. We encourage you to contact us to discuss a gift of closely held interests, and work with a qualified professional to craft this type of gift.
Insurance
For those whose need for life insurance has decreased, making a gift of an unneeded policy can be a convenient and effective way to meet charitable goals. Life insurance often allows a prospective donor to make a significantly larger charitable gift than might be possible using their current assets.
Transferring ownership of a cash value policy to WCF makes the donor eligible for a charitable tax deduction based on its current value. Estate taxes are also reduced since the value of the policy is removed from the donor’s estate. A donor can make life insurance part of his or her estate planning by naming the Wichita Community Foundation as a partial and/or contingent beneficiary of any insurance policy’s death benefit.
By making the Foundation beneficiary of the life insurance contract, the donor can take a deduction for the ongoing premium payments. Either cash or publicly traded securities may be used to make premium payments. Or if they prefer, a donor can also receive tax benefits if he or she make a gift of a paid-up life insurance contract. Alternatively, the donor can remain the owner of a contract and name the Foundation as partial, sole or contingent beneficiary of the life insurance death benefit. No income tax deduction will result, but the gift will create a charitable deduction for the donor’s estate.
Art
Donating art, antiques and other collectible objects to Wichita Community Foundation may provide your clients with the following possible benefits:
Your clients generally will receive a higher income tax deduction if they donate an art object or collection that has appreciated in value over the time they have owned it. Art objects and collections held more than one year are capital gain property. Generally, property is capital gain property if its sale at fair market value on the date of the contribution would have resulted in long-term capital gain. Capital gain property includes capital assets held more than one year. The general rule is that a client can usually deduct the full fair market value of the donation as of the date of the contribution.
In order to maximize your client’s charitable deduction benefits, (a deduction of the full fair market value), the qualified organization must be a public, not private, charitable organization. The Wichita Community Foundation is a public charity.
Prospective donors should also be aware the Pension Protection Act of 2006 increased the requirements of a qualified appraiser in charitable contributions of personal property such as art and collectibles. Equally, it is important to make sure your client understands that the Wichita Community Foundation typically sells art, antiques and collectibles in order to fund its charitable mission in the community of Wichita. The donor can direct the proceeds of the sale be used for a specific purpose upon the sale and is encouraged to talk with the Foundation staff concerning his or her gift as laws governing these types of gifts are highly subject to change.
For more information, please contact us.
Deferred Giving
Wills and Revocable Trusts
A charitable bequest, made through a Will or Revocable Living Trust, is the most popular type
of estate gift. Bequest gifts are flexible, fairly easy to arrange, and, perhaps most importantly,
allow your client to retain control of his or her assets during their lifetime. Wills and revocable trusts provide a variety of ways to tailor your client’s legacy to what matters most to them.
To maximize flexibility, your client can provide for a bequest gift to the Wichita Community Foundation in their Will or Living Trust but specify the purpose of the gift by means of a Letter of Intent. This strategy allows for change- change in charitable goals, change in marital status, etc. The client is not bound by the choices he or she has made today. The Foundation allows Letters of Intent to be revised to the donor’s changing wishes at no charge.
Sample Language for Bequests
Gifting a Specific Amount of Money
“I give to the Wichita Community Foundation, a nonprofit corporation of the State of Kansas, currently located at 301 N. Main, Suite 100, Wichita, KS 67202, and successors and assignees, the sum of $____.”
Gifting a Specific Piece of Property or Shares of Stock
“I give to the Wichita Community Foundation, a nonprofit corporation of the State of Kansas, currently located at 301 N. Main, Suite 100, Wichita,KS 67202, and successors and assignees,
(insert a description of the property, e.g.) ____ shares of stock in ____ Company or “real property located at ____ with a legal description of ____.”
Gifting the Remainder of an Estate
“I give to the Wichita Community Foundation, a nonprofit corporation of the State of Kansas, currently located at 301 N. Main, Suite 100, Wichita, KS 67202, and successors and assignees, all or ____% of the rest, residue, and remainder of my estate.”
Language for a Contingent Gift
”If [name/s of primary beneficiaries] do/es not survive me, or shall die within ninety (90) days from the date of my death, or as a result of a common disaster, then I give to the Wichita Community Foundation, a nonprofit corporation of the State of Kansas, currently located at 301 N. Main, Suite 100, Wichita, KS 67202, and successors and assignees, [describe amount of cash, specific property or percentage of residual estate).”
Possible Options for a Client’s Bequest
• “My bequest shall be used to establish a Donor Advised Fund with the following individual(s) as fund advisors: ____, ____, and ____.
• “My bequest shall be used to establish a fund to devoted to the following cause or issue: ____.”
• “My bequest shall be used to establish a fund to support the following Section 501 (c) (3) public charity(ies) ____.”
• “My bequest shall be used to establish a Scholarship Fund to support scholarships [at the____ School, for a special area of study, or in recognition of academic achievement or other qualities].”
• “My bequest shall be used to support the WCF Grant Pool.”
• “My bequest shall be used to support the Operating Endowment Fund of the Wichita Community Foundation.”
Power to Vary Language
To be added after the purpose: “If, in the opinion of the Board of Directors of the Wichita Community Foundation, it should become impossible, inadvisable, or impractical to use this gift for the specified purposes(s), then the Board may in its discretion use the gift to the best advantage of the Wichita Community Foundation, keeping in mind the original wishes of the donor. In any such alternative application, the support provided by this bequest shall be clearly identified with the name of [donor’s name].”
Fund Name
I wish for the fund established through my bequest to be named____.
Naming the Wichita Community Foundation as a Beneficiary
In some cases, donors prefer to name the Community Foundation as a beneficiary of all or part of a financial arrangement such as a retirement plan, IRA, or life insurance policy. Such gifts can have several advantages. They are easy to make or modify, allow the donor to retain control of his or her assets during their lifetime, generally avoid the delays associated with probate, and are a very tax-wise way to give. Gifts to the Community Foundation are tax exempt and 100% of your client’s gift is put to work as you direct.) We encourage prospective donors to consult their legal and tax advisors regarding what will work best for them.
The Wichita Community Foundation encourages donors to seek professional legal, estate planning and financial advice before deciding on a particular gift arrangement.
InterVivos Trusts
A revocable intervivos or "living" trust is an important part of the estate plan of many people. Intervivos means "during life," which is when the trust is established. Revocable means that the creator, also known as the grantor, of the trust can change the terms of the trust or revoke it completely during his or her lifetime. Assets in trust are not part of your client’s will; they are transferred according to the instructions in the trust document.
In recent years, the use of intervivos trusts has allowed donors to make their charitable contributions during their lifetimes rather than at death. Arguably this practice can increase the effectiveness and significance of a donor’s gift. This approach is complemented and encouraged by new approaches in financial planning where the donor’s ability to shape their legacy supercedes tax considerations.
The Wichita Community Foundation is experienced in administering these types of trusts and we encourage you and your client to discuss your mutual charitable objectives with us.
Gift Annuities
A charitable gift annuity can provide your client with lifetime income. To establish a gift annuity, the donor contributes funds or assets to the Wichita Community Foundation (WCF), and WCF in turn makes fixed annuity payments to the donor from its general assets for the rest of his or her life. The donor receives an immediate income tax deduction for a portion of the gift, and a portion of each annuity payment is treated as a tax-free return of the investment. The portion of the gift not used for payments benefits WCF.
The income payments from gift annuities can begin immediately or be deferred. The minimum age for a gift annuity is typically 50, but it can be lower for deferred gift annuities with payments beginning after age 50. The payment your client receives is fixed and the amount is based on life expectancy and other factors.
All proposed gift annuity plans are subject to approval by the WCF Fund Acceptance Committee. We encourage you and your client to discuss this charitable option with our staff.
