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Leading the Way: Expert Attorney Discusses Charitable Lead Trusts

Brad Gornto and his wife

Brad Gornto and his wife, Cindy, met by chance while separately attending a Florida State homecoming game. The couple is pictured here with their four children.

Attorney and loyal FSU alumnus Brad Gornto (B.S.,'95) is hard at work. When he isn't counseling his clients on the best ways to keep more of their hard-earned dollars, he's advising them on how to best give to their most important causes.

He credits his strong work ethic to lessons learned during his years at FSU while working in the advertising department of the Florida Flambeau (now published as the FSView & Florida Flambeau). His passion for charitable gift planning began as a law student while working for a nonprofit foundation supporting higher education. Brad has since put his work ethic and experience in charitable planning to use in not just one, but two successful practices.

After graduating from law school and obtaining a Masters of Law in Taxation, he joined his father in 2001 to form Gornto and Gornto P.A., an estate planning, tax and business law firm in Daytona Beach, Fla. In 2012, Brad established Effectual Giving LLC, a planned giving consulting firm that helps philanthropists achieve their charitable goals.

Brad uses his expertise to act as the intermediary between charitable organizations and philanthropists to ensure that both parties are engaged in the giving process.

"Too often, people give in isolation without exploring all of their options," Brad says. He encourages donors to be open and communicative with their advisors and with staff at the organizations they choose to support.

Brad helps improve the giving process at Florida State by advising the Office of Planned Giving staff in their efforts to provide the best possible solutions for Florida State supporters. He brings with him a special expertise in the strategy known as the charitable lead annuity trust, or CLAT, which he describes as a particularly powerful tool given today's low interest rates.

"A charitable lead annuity trust, specifically a reversionary CLAT, is a trust that distributes a series of payments to FSU over a period of years and then distributes the remaining principal back to the donor," Brad says.

He notes that while this type of commitment is often underutilized, it greatly benefits the charity and also provides stability for the donor.

"This strategy can generate a very large charitable income tax deduction for a donor in the current year, without requiring a large lump-sum charitable gift and without disturbing the donor's overall estate plan," he says.

"My years at Florida State were some of the best times of my life," Brad says. "I am thrilled to now be able to use my experience with CLATs and other gift planning tools to help alumni and friends impact the lives of current and future Florida State students."

If you would like to learn more about charitable lead annuity trusts or other planned gifts, please contact The Office of Gift Planning at (850) 644-0753 or giftplanning@foundation.fsu.edu.

 

A charitable bequest is one or two sentences in your will or living trust that leave to Florida State University a specific item, an amount of money, a gift contingent upon certain events or a percentage of your estate.

an individual or organization designated to receive benefits or funds under a will or other contract, such as an insurance policy, trust or retirement plan

"I give to Florida State University, a nonprofit corporation currently located at Tallahassee, Florida, or its successor thereto, ______________* [written amount or percentage of the estate or description of property] for its unrestricted use and purpose."

able to be changed or cancelled

A revocable living trust is set up during your lifetime and can be revoked at any time before death. They allow assets held in the trust to pass directly to beneficiaries without probate court proceedings and can also reduce federal estate taxes.

cannot be changed or cancelled

tax on gifts generally paid by the person making the gift rather than the recipient

the original value of an asset, such as stock, before its appreciation or depreciation

the growth in value of an asset like stock or real estate since the original purchase

the price a willing buyer and willing seller can agree on

The person receiving the gift annuity payments.

the part of an estate left after debts, taxes and specific bequests have been paid

a written and properly witnessed legal change to a will

the person named in a will to manage the estate, collect the property, pay any debt, and distribute property according to the will

A donor advised fund is an account that you set up but which is managed by a nonprofit organization. You contribute to the account, which grows tax-free. You can recommend how much (and how often) you want to distribute money from that fund to the FSU Foundation or other charities. You cannot direct the gifts.

An endowed gift can create a new endowment or add to an existing endowment. The principal of the endowment is invested and a portion of the principal’s earnings are used each year to support our mission.

Tax on the growth in value of an asset—such as real estate or stock—since its original purchase.

Securities, real estate or any other property having a fair market value greater than its original purchase price.

Real estate can be a personal residence, vacation home, timeshare property, farm, commercial property or undeveloped land.

A charitable remainder trust provides you or other named individuals income each year for life or a period not exceeding 20 years from assets you give to the trust you create.

You give assets to a trust that pays our organization set payments for a number of years, which you choose. The longer the length of time, the better the gift tax savings to you. When the term is up, the remaining trust assets go to you, your family or other beneficiaries you select. This is an excellent way to transfer property to family members at a minimal cost.

You fund this type of trust with cash or appreciated assets—and receive an immediate federal income tax charitable deduction. You can also make additional gifts; each one also qualifies for a tax deduction. The trust pays you, each year, a variable amount based on a fixed percentage of the fair market value of the trust assets. When the trust terminates, the remaining principal goes to the FSU Foundation as a lump sum.

You fund this trust with cash or appreciated assets—and receive an immediate federal income tax charitable deduction. Each year the trust pays you or another named individual the same dollar amount you choose at the start. When the trust terminates, the remaining principal goes to the FSU Foundation as a lump sum.

A beneficiary designation clearly identifies how specific assets will be distributed after your death.

A charitable gift annuity involves a simple contract between you and the FSU Foundation where you agree to make a gift to the FSU Foundation and we, in return, agree to pay you (and someone else, if you choose) a fixed amount each year for the rest of your life.

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