by Sheila Kinman, CAP®
If you’re like many advisors, you may have discovered that often charitable giving conversations begin (and end!) with cash or appreciated stock. And, of course, you know that appreciated stock is an excellent option for your clients to fund a donor advised or other type of fund at Community Foundation Tampa Bay because it may avoid capital gains tax while also potentially qualifying for a charitable deduction at fair market value.
But for some clients—especially business owners, collectors, and affluent retirees—valuable assets may take a very different form. Boats, airplanes, cars, RVs, and other tangible property can represent a mixed bag of characteristics: significant wealth, ongoing maintenance costs, and emotional attachment, all of which may create charitable giving opportunities. These situations are becoming increasingly common. Classic cars are a notable example, with some estimates placing the total at more than 43 million vehicles in the United States alone, representing an estimated $1 trillion in total insurable value.
Here are four tips to consider as you work with your charitable clients.
Always reach out to the Community Foundation
Anytime you’re working with a charitable client, please reach out to the Community Foundation to explore your client’s options. Your clients may be surprised to learn that public charities, such as the Community Foundation, can accept a wide range of noncash assets, provided those assets can be evaluated, valued, transferred, and ultimately liquidated to support your clients’ charitable goals.
Ask questions beyond balance sheet basics
Clients may forget to mention that they own highly appreciated noncash assets. As they prepare to meet with you, they are often focused on gathering investment statements and real estate information, overlooking assets such as classic cars, RVs, airplanes, and boats.
These conversations are especially timely as many affluent households continue to hold substantial wealth outside of traditional investment portfolios. Recreational assets purchased years ago may now hold significant value while also generating ongoing expenses, storage concerns, and succession planning questions. Clients who are downsizing or simplifying during retirement may welcome charitable strategies that transform underused assets into community impact.
Build your client’s charitable plan before a sale
When you identify unusual assets on a client’s balance sheet and you know your client’s charitable goals, it’s important to explore the possibilities. A client preparing to sell a classic car or boat, for example, could incur significant capital gains tax if the asset has appreciated in value. In appropriate circumstances, contributing the asset to a fund at Community Foundation Tampa Bay before a sale may help reduce or eliminate those taxes while also generating funds to support the charitable causes the client cares about.
Pay attention to the rules
Gifts of noncash assets require careful coordination. Unlike publicly traded securities, these assets involve additional due diligence. Title transfers, appraisals, environmental reviews for real estate, insurance considerations, debt obligations, marketability, and liquidation logistics all require careful attention. The IRS also imposes specific substantiation and reporting requirements for charitable deductions involving noncash gifts.
The team at Community Foundation Tampa Bay is happy to work alongside you and your clients’ attorneys, CPAs, valuation experts, and financial advisors to determine whether proposed gifts are feasible and which charitable structures might be the best fit. In many cases, the Community Foundation can accept the asset and facilitate its sale.
The bottom line here is that for a charitable client, using a much-loved car collection, boat, or other luxury asset to support favorite causes and address community needs may be far more appealing than knowing the asset could sit in storage for years and years while maintenance expenses continue to grow.
You can add tremendous value by helping your clients consider whether highly specialized collections and “passion assets” are better suited for charitable planning than for transfer through an estate, especially when heirs may not share the same interest in maintaining or managing them. Whether your client owns a rare bicycle collection, antique toy collection, classic cars, or a country music producer’s private library, conversations about donating unusual assets can help simplify estates, support charitable priorities, and avoid placing the emotional and logistical burden of niche collections on the next generation.
Every client's circumstances are unique. Community Foundation Tampa Bay can help you explore charitable solutions that make the most of complex assets while advancing your clients' philanthropic goals.
Sheila Kinman, CAP® serves as Chief Philanthropy Officer at Community Foundation Tampa Bay. A seasoned expert in providing philanthropic solutions, she is dedicated to facilitating the joy of giving for donors. Sheila specializes in helping individuals, private foundations, nonprofits, and corporations direct their charitable giving in impactful and financially strategic ways. Her expertise also includes facilitating unique, non-cash gifts, such as donations of closely held business interests and real estate.
.webp)
%20(1).webp)