“SurveyMonkey board member Sheryl Sandberg plans to donate her stake in the company to charity, as part of her commitment to the Giving Pledge. Donating appreciated assets is a strategy that can benefit all investors, regardless of your level of wealth.”
If you donate to charity regularly, you may want to look at creating a donor-advised fund, according to CNBC’s recent article, “What you can learn from Sheryl Sandberg's plans to donate her SurveyMonkey shares.”
SurveyMonkey board member Sheryl Sandberg has plans for her ownership of the company. Sandberg, who is a member of the company's board and COO at Facebook, plans to donate all of the shares she owns, or the proceeds of the sale of those shares, to the Sheryl Sandberg & Dave Goldberg Family Foundation, according to the company's IPO prospectus. Her charitable plans are part of her strategy to participate in the Giving Pledge, whereby some of the world's wealthiest individuals, including Warren Buffett and Bill Gates, have agreed to give most of their wealth to charity. Sandberg has already donated Facebook shares to charity through a donor-advised fund.
Many people experience satisfaction in giving during life, and Sandberg’s actions are a good lesson in charitable giving. Giving appreciated investments to charity is a wise strategy. However, there are some things to consider before you do this.
The tax savings from charitable giving can be significant, but that shouldn’t be your sole rationale for giving. The reason is that you’ll still be parting with more money than the tax itself. Don't write a large check for charitable purposes, without reviewing it with your attorney. In many cases, she can increase the value and benefit of the gift at no cost to the charity. If you plan to give money away to charity on a regular basis, you may want to think about a donor-advised fund.
A donor-advised fund allows you to monitor your charitable donations, because the money comes from one fund. The IRS lets you take a tax deduction in the year you give to your donor-advised fund. You then can let the money sit in your account, until you decide that you are ready to donate it. Donor-advised funds also let a person shield their gifts from the public.
Another kind of endowed-giving vehicle is the private foundation. This generally work well for those with larger amounts of money. Typically, people don’t create a foundation for less than several million dollars, and they should be set up with an attorney. With a foundation, you can set up scholarship grants and employ family members. They are frequently used by larger donors who want that level of control and are willing to have all of their granting done publicly.
Reference: CNBC (October 4, 2018) “What you can learn from Sheryl Sandberg's plans to donate her SurveyMonkey shares”