by Denyve Boyle, CAP, Associate Vice President of Philanthropy
If your client base includes business owners, you may already be familiar with the general benefits of giving closely-held business interests to charity. The specifics, however, can feel less clear. That is understandable. Most advisors encounter only a few of these opportunities over the course of their careers. The most important step is recognizing when a charitable strategy may be possible, so you can involve the Community Foundation Tampa Bay team early and help your client make the most of it.
In the coming decade, we’re facing the largest intergenerational transfer of privately held business wealth in U.S. history. Baby boomers are retiring, and many are selling or transitioning their businesses. For many owners, their business represents 70–80% of their net worth.
When those owners begin to think about succession, they’re not just thinking about numbers—they’re thinking about their legacy:
What will happen to their employees?
Their community?
Their name?
Their values?
This is where charitable planning can become a meaningful bridge—connecting personal values with financial strategy. And here’s the best part: When philanthropy is integrated early, it’s not just “feel good”—it can also create powerful tax efficiencies and enhance overall planning outcomes.
Consider the following example, based on a hypothetical business owner, Alex Monroe, who may resemble clients you already serve.
–When Alex casually mentioned that he was thinking about selling his company, you paid close attention. You knew that Alex has supported several charities over the years, and you took time to review charitable options through the Community Foundation in case the conversation progressed.
–You also understood that the value of Alex’s company had grown significantly, creating substantial unrealized capital gains. If he were to sell without additional planning, a meaningful portion of the sale proceeds would go toward capital gains tax, reducing the value he spent years building.
–Many business owners in this situation move quickly into the sale process by signaling interest to buyers, setting an asking price, and signing a letter of intent. In doing so, they may unintentionally miss strategies that could improve their financial and charitable outcomes.
–In Alex’s case, you recommended involving Community Foundation Tampa Bay early. You explained that making a charitable gift of a portion of the company’s shares to a donor advised fund before any formal sale activity begins could be a valuable option.
–You also shared that a properly timed gift allows the donor advised fund to receive sale proceeds without incurring capital gains tax, which preserves more value for Alex’s charitable goals. This approach also removes the gifted shares from Alex’s taxable estate, creating a potential estate tax benefit.
Whether you encounter a scenario like Alex’s once or many times in your career, the key is to bring the Community Foundation Tampa Bay team into the conversation at the very beginning of the planning process. These transactions require thoughtful coordination and awareness of several important considerations. For example:
–A qualified appraisal is required for non-cash charitable gifts. Without strict compliance with IRS rules, your client’s charitable deduction could be jeopardized.
–To avoid capital gains tax, no shareholder votes or signed letters of intent can be in place before the gift occurs. If these steps have already happened, the IRS may treat the transaction as a completed sale and disallow the deduction.
–These gifts are typically more effective when directed to a public charity, such as Community Foundation Tampa Bay, rather than a private foundation. Some advisors are not aware of the significant differences in tax treatment, and the Community Foundation carefully reviews each proposed gift to ensure compliance and feasibility.
Sooner or later, you will work with a charitably minded business owner who is ready to consider selling their company. When that moment comes, and in any situation involving charitable planning, the Community Foundation Tampa Bay team is here to support you. You can help your clients transform a financial event into a force for good, preserving both wealth and purpose.
We are honored to partner with you to create meaningful and effective solutions for your clients.
Denyve Boyle, CAP®, CFRE, MBA is the Associate Vice President of Philanthropy at Community Foundation Tampa Bay. She is an experienced, highly motived professional that inspires philanthropy throughout the community by educating and engaging individual donors, corporations, and professional advisors. She can be reached by phone at (813) 609-4868 or via dboyle@cftampabay.org.
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