As a Professional Advisor, you hold a great deal of responsibility to your clients. They trust you to guide them through the complexities of the various financial vehicles and strategies to secure their financial needs for now and the future, as well as leave tax favored future funds for heirs. Incorporating planned giving into your practice through LegacyTree Foundation gives you access to a powerful, unique, and effective planning tool that can help them achieve those goals. LTF LegacyPlans are versatile and offer a variety of benefits that can be tailored to meet your client’s tax, income, estate planning needs and philanthropic goals. We work with you to structure the best LegacyPlan for your clients and provide you the materials and information necessary to offer these plans to your clients.

Each LegacyPlan provides structured immediate or deferred income, along with tax benefits that vary according to the asset used to fund the LegacyPlan. In addition, each LegacyPlan allows your client to recommend a grant(s) to their favorite charity(ies). LTF professionals are here to help you with all the back office support you will need to be able to incorporate and add this valuable tool into your practice.

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2019 Organizational Summary

State Chart

Client Brochure

Advisor Intro Whiteboard

Client Intro https://youtu.be/bSYrp2E1vE8

FAQ video https://youtu.be/cNobj2B7tlw

An Introduction to LegacyTree Foundation LegacyPlans

Below is a description of the LegacyPlans that LTF offers. The tax benefits will differ according to the assets used to fund the LegacyPlan, as well as how the income is structured.

Term Certain LegacyPlan:

This is a bargain sale (Section 1.1011-2 of the Federal Tax Code) coupled with an installment sale (Section 453 of the Code). This type of LegacyPlan creates an income that lasts for a term of years which can begin immediately or be deferred for future use. Multiple beneficiaries may be named to receive any remainder income, which may also be charitable organizations. A charitable deduction is created which can be used the year of the transaction with a five year carry forward. This LegacyPlan can be funded with liquid assets, securities, real estate and annuities as well as other types of assets. Benefits such as a reduction of estate tax is created as well as partial forgiveness of capital gains are created depending on the asset used.

Charitable Bargain Sale Video https://youtu.be/37dzymK3yCY

Lifetime LegacyPlan:

The Lifetime LegacyPlan is a charitable gift annuity, as described in 501(m)(5) of the Code, which provides income for the lives of one or two individuals. Income can be immediate or deferred or set up to provide lifetime income for children. Many advisors use this type of plan to fund life insurance. An immediate charitable deduction is created, which can be used the year of the transaction with a five-year carryforward. Many assets can be used to fund a Lifetime LegacyPlan, including cash, securities, real estate or annuities. A reduction in estate tax is a benefit as well as a partial forgiveness of capital gains depending on the asset used.

LEAF LegacyPlan

The Legacy Endowment Advised Fund (LEAF) is a donor advised fund which provides the flexibility of advising the charitable distributions to multiple charitable causes and advising such distributions on an annual basis. Contributions to an LTF LEAF allow an immediate charitable tax deduction for the full asset value used to fund the LEAF with carry forward deduction for up to five (5) years. The funds inside a LEAF are not managed like a traditional donor advised but are insured to pay a fixed amount every year for a term of years. The contributions can begin immediately, and a Successor Advisor can be named by the LEAF donor to direct any grants should they pass prior to the term.

  • LEAF Video
  • LEAF Marketing and Training Materials
  • LEAF Case study
  • LEAF Flyer

How does LegacyTree Foundation Reserve the Funds for LegacyPlan Obligations?

Every LegacyPlan creates an obligation that LegacyTree Foundation is responsible to pay. How LTF reserves the necessary funds to pay that obligation is very important and is a strong part of the presentation to your client on the safety and security of their decision to trust your recommendation. LegacyTree Foundation understands the importance of safeguarding the integrity and commitment of its payment obligations to LegacyPlan owners and adopted the conservative decision to place the required present value amount of each LegacyPlan into a fixed commercial annuity issued by a highly rated and/or capitalized insurance carrier. This is called our Reserve Method.

Fixed commercial annuity contracts purchased are issued with LegacyTree Foundation as the owner and beneficiary and with the LegacyPlan owner or one of their heirs (typically) as the annuitant and income recipient.

When possible, LTF directs the insurance company to make the LegacyPlan payments directly to the income recipient named in the LegacyPlan. LTF issues the end of the year 1099R to each income recipient which accurately reflects the income exclusion ratio to each LegacyPlan contract.


What Assets Can Be Used to Fund a LegacyPlan?

There are a variety of assets that can be used to fund a LegacyPlan. Each one has a distinctive set of benefits and uses that are outlined below.


These are a few of the scenarios where a LegacyPlan may be a
good solution.

  • Senior clients that plan on passing their annuity(ies) to heirs
  • Senior clients that are being forced into annuitization
  • Clients who have inherited an annuity along with the tax consequences

The charitable deduction associated with a LegacyPlan is used to mitigate the growth inside the annuity, making the tax consequences for heirs or beneficiaries of an annuity less impactful. In addition, if you have clients that are being forced into annuitization due to their age, a LegacyPlan allows them the opportunity to continue to defer the income to their heirs. With trillions of dollars of in-force annuities that will never be used for income and will be passed to heirs, a LegacyPlan offers a solution that can reduce annuity tax liability to the donor’s heirs and may be the most suitable option for your clients.

Since LegacyTree Foundation has no age limits annuities are a popular asset used to fund LegacyPlans.



Here are some common situations where a LegacyPlan funded with cash are used:

  • Offset a taxable event
  • Reduce tax liability for small business owners
  • Minimize or eliminate tax on a Roth Conversion
  • Reduce taxable income in working years and set up fixed retirement income

Liquid Assets are commonly used to fund LegacyPlans. The deduction generated by a LegacyPlan funded with cash or other liquid assets may be of considerable value to reduce taxable income and is often used creatively to access other assets in a tax advantaged manner. The full value of the asset or more is typically returned depending on how the income is structured.



If you have any clients that fall into any of the following scenarios, a LegacyPlan may be a good fit for them:

  • Senior clients needing to reduce their exposure in the stock market
  • Clients who need or desire to access their holdings but have large capital gains issues
  • Clients who have enjoyed the upside of the market and wish to lock in the value while minimizing taxes
  • Clients who need to access asset values to fund life insurance
  • Clients who want to lock in a value, minimize taxes, and set up fixed income for themselves and/or heirs.
  • Clients wanting to reduce capital gain taxes and reduce their income taxes

Funding a LegacyPlan with appreciated securities allows clients to benefit from the income tax deduction but also benefit from the capital gain reduction. This is a great way to lock in the current value of the security while receiving immediate tax benefits as well as a structured income for themselves and/or their heirs. The older clients become they may find that their risk tolerance becomes lower. A LegacyPlan is an exit plan for securities that will help save taxes and give peace of mind.

Securities Marketing and training Materials:


Many of your clientele own a second home, rental property(ies), commercial property, raw land, farmland, industrial property or other investment property. As an advisor you may have felt limited in the ways you can help your clients. A LegacyPlan funded with real estate may be the perfect solution to help your clients exit from these types of assets and receive these benefits:

  • A partial elimination of capital gain
  • Reduction of estate tax
  • Reduction of recapture tax
  • Income tax deduction
  • Structured income for themselves or their heirs

Many people use a LegacyPlan to help substitute the investment income they were receiving on their property, without all the headaches of ownership!
Many people also use the LegacyPlan income to fund life insurance that goes to the children tax free – in lieu of causing the children to have to deal with probate and liquidation off inherited real estate assets.

Real Estate Marketing and Training Materials


Brochures, Due diligence, and other training materials: