A New Public Charity in the Trust Form

Author National Philanthropic Trust

June 4, 2012

Last week, NPT reached a long-awaited goal as we launched our new affiliate: NPT Charitable Asset Trust (NPT CAT). “The CAT,” as we’re calling it around the office, is a public charity in the trust form. The CAT offers tax advantages for donors who gift certain types of assets—particularly those in the illiquid form.

Over the past several years, we’ve seen a marked increase in the number of donors who want to contribute illiquid assets to their donor-advised funds. In our last Donor-Advised Fund Report, we predicted this trend would continue, which is why we established NPT CAT.

Most gifts to a public charity in the trust form are subject to lower tax rates than other charitable organizations. We have a great example of the tax savings for charitable contribution of S-Corporation stock to a public charity in the trust form. We found that a gift to a charity like NPT CAT can save between $400,000 and $600,00 as compared to cashing out the stock and giving the proceeds to charity, or contributing it to a donor-advised fund at a charity in the corporate form.

That savings means more money is available to support charitable organizations and is why the CAT and NPT share the mission of increasing philanthropy in society.

You can view the details of our S-Corporation case study and learn more about NPT CAT on its new website at www.nptcat.org.