Q: What is MS GIFT’s official name?
A: Morgan Stanley Global Impact Funding Trust, Inc.
Q: What is MS GIFT’s taxpayer identification number?
Q: What is your mailing address?
A: c/o Drinker Biddle & Reath LLP, 1177 Avenue of the Americas, 41st Floor, New York, NY 10036-2714
Q: Is MS GIFT a charity?
A: Yes. Morgan Stanley GIFT is a tax-exempt non-profit organization described in Section 501(c)(3) of the Internal Revenue Code. MS GIFT is further classified as a “public charity” for federal income tax purposes.
Q: What is a donor advised fund?
A: A donor advised fund is an account established with a qualified charity (known as the donor advised fund’s “sponsoring organization”) that permits the donor (and/or other parties designated by the donor known as advisors) the right to make certain non-binding recommendations to the charity with respect to the fund’s administration. The donor or advisor to a donor advised fund account typically will be able to recommend grants to other charities out of the donor advised fund and how the account is invested.
A donor’s contributions to a donor advised fund are irrevocable and are eligible for a charitable deduction. Grants out of a donor advised fund to other charities do not give rise to a further tax deduction.
Q: What is the minimum size for a new account?
A:The minimum size for a new account is $25,000.
Q: What is the minimum size for an additional contribution to a new account?
A: An additional contribution to an existing account must be worth at least $5,000.
Q: What is the minimum size for a grant?
A: Each grant must be at least $250.
Q: What types of property can I contribute to my donor advised fund account?
A: Donors may make irrevocable and nonrefundable charitable gifts of cash, marketable securities, freely transferable restricted stock and exercised options. Other assets (such as real estate, closely-held business interests, life insurance and artwork and other collectibles) may be accepted at the discretion of MS GIFT’s Board of Directors.
Q: Is MS GIFT part of Morgan Stanley?
A: MS GIFT and Morgan Stanley are separate legal entities and MS GIFT is neither owned by nor a subsidiary of Morgan Stanley. A subsidiary of Morgan Stanley provides investment management and administrative services to MS GIFT.
Q: Can I make a grant to an individual out of my donor advised fund account?
A: Federal tax laws do not allow grants from a donor advised fund to a natural person.
Q: I would like to pay money directly from my individual retirement account to my donor advised fund account using the “IRA charitable rollover.” Can I do this?
A: Federal tax laws do not allow contributions to a donor advised fund using the IRA charitable rollover.
Q: Can I recommend a grant from my donor advised fund in order to help fulfill a pledge that I have made to another charity?
A: A donor or advisor may not use a grant from a donor advised fund to satisfy a personal pledge.
Q: The local organization that I want to support told me that it is a “501(c)(3).” Can I make a grant to it out of my donor advised fund account?
A: A donor advised fund account at Morgan Stanley GIFT can be used to support a wide variety of charitable organizations described in section 501(c)(3) of the Internal Revenue Code. Federal tax laws actually divide section 501(c)(3) organizations into several different categories. Public charities, such as schools, hospitals, churches and other broadly-supported organizations, are eligible to receive grants. Private foundations, which typically are supported by only a small number of donors, are not eligible to receive grants from a donor advised fund account. Each charity is categorized by the Internal Revenue Service, and its status can change from time to time. Please feel free to contact us in advance if you have any questions about whether your favorite charity is eligible to receive a grant from Morgan Stanley GIFT.
Q: How can I get another copy of the acknowledgment letter that I received in the mail for my contribution to the donor advised fund last year? I lost the original letter and need a new copy for my income tax return.
A: Copies of old acknowledgment letters are available through Morgan Stanley GIFT’s donor portal, which is the same website that you use to recommend grants and check fund balances. After you log into your account, access the “Contribution Activity” section. Under “Contribution Activity Search” choose the time period in which you made the contribution. You will then be able to see the contribution activity details and have an opportunity to print a receipt that you may use for tax purposes.
Q: I would like to make a gift from my donor advised fund to my college, to be used for a scholarship fund named after me. Is this possible?
A: Yes. A grant may be made from a donor advised fund to another public charity to support a scholarship program if: (i) the charity receiving the grant is administering the program, (ii) neither the donor nor any of the donor’s family members has any part in the selection of scholarship recipients, and (iii) the grant is not being used to fulfil a prior personal pledge made by the donor or related party.
Q: I want to go to a gala. The charity sponsoring it told me that part of the cost of the ticket is for the actual cost of the event and part is a donation to the charity. Can I pay for the "charitable" portion of the ticket out of my DAF if I pay the rest from my own funds?
A: Unfortunately, a grant from a DAF cannot be used to purchase a gala ticket, even if the grant only covers the charitable portion of the price. The full cost of the ticket will need to be purchased with funds from another source.
Q: I would like to make a gift to a local museum to be used to sponsor a new work by a particular artist. Can this be done?
A: Yes. A grant may be made from a donor advised fund to another public charity to support a project or specific research if: (i) the board of directors of the museum receiving the grant retains ultimate control over the use of the fund, (ii) the grant does not benefit the donor or any member of the donor’s family in any way, and (iii) the grant is not being used to fulfil a prior personal pledge made by the donor or a related party.
Q: I have already set up a donor advised fund. How can I research charities before recommending grants to them?
A: There are a variety of resources available for researching charitable organizations that you may wish to support. An article on our website called “Tips for Effective Grant Making” describes some research tools that are available over the internet, as well as factors that you may wish to consider in selecting charities.
Q: I have owned shares of stock in a corporation for a long time. I just read in the newspaper that the company is doing a corporate inversion in order to lower its taxes. My tax advisor has told me that I will realize a capital gain on all of the appreciation in the stock even though I am not actually selling the shares. Is there anything that I can do to avoid realizing the capital gain?
A: You can avoid realizing the capital gain by contributing the shares to a donor advised fund at Morgan Stanley GIFT before the inversion is finalized. You will be eligible to receive a charitable deduction based upon the fair market value of the shares on the date of the gift, but you will not have to realize the capital gain.
Q: Can I make a grant from my donor advised fund to a local volunteer fire department or an organization that supports police officers?
A: It is possible to make grants to one of these organizations from your donor advised fund if the grantee is recognized as a "public charity" by the Internal Revenue Service or if it is legally part of a local governmental body (such as a town or county). A grant generally cannot be made from your donor advised fund if the Internal Revenue Service classifies the organization as another kind of tax-exempt organization, such as a "social welfare organization", unless Morgan Stanley GIFT uses the expenditure responsibility procedures described in the Donor Circular & Disclosure Statement. If you are in doubt about an organization’s tax status, ask the organization to confirm it before submitting a grant request.
Q: My college alumni association is selling basketball season ticket packages for $5,000 and I am told that $4,000 of the price is a charitable gift. May I make a grant from my donor advised fund to pay the “tax deductible” portion of the package? My grant would be limited to $4,000 and I would pay the $1,000 myself?
A: Unfortunately, a grant from the donor advised fund cannot be used to fund the purchase of the tickets in this situation, even if the college has identified the amount of the grant as being tax deductible. Federal law does not allow a grant from a donor advised fund to provide any tangible benefits to the donor or another individual. The donor would receive basketball season’s tickets in return for the grant described above, which is a benefit. Funding a portion of the purchase price of the tickets from a donor advised fund allows the donor to purchase $5,000 tickets for only $1,000 of his individual money, which also confers a benefit on the donor. The donor may make the grant to his college if he waives the right to receive anything back in return.
Q: I own a highly-appreciated position in a particular stock. Do I have to pay a capital gain if I give the stock to a donor advised fund?
A: No. As a general rule, if a person gives a highly-appreciated position to a donor advised fund which then sells the position, the person will not have to pay a tax on capital gain realized by the fund. This is one of the reasons that highly-appreciated stock positions make very attractive assets to give to charity. Exceptions to the general rule can arise in rare circumstances, so a donor should always consult with his or her tax advisors about the tax treatment of any gift.
Q: Can I contribute to my donor advised fund by credit card?
A: Yes, it is now possible to contribute to an existing donor advised fund by credit card. Donors wishing to take advantage of this option should log in to their accounts, select the “Fund My Account” tab and then provide the requested information. There is no minimum amount for a credit card donation to an existing account, and such donations do not require the use of an additional contribution form. Donors also may fund new accounts, in whole or in part, by credit card, although the minimum contribution needed to open a new account remains $25,000.
Q: I would like to give part of my family business to charity and have previously created both a donor advised fund a private foundation. It is better for me to give to one vehicle over the other?
A: If a person donates an ownership interest in a private company to a donor advised fund, the value of the donated property for tax purposes is its fair market value on the date of the gift. If that same ownership interest is donated to a private foundation, its value for tax purposes is limited to the donor’s basis in the donated property (which is often based on what the donor paid to acquire the ownership interest). Please see our article “What’s Right for You: A Donor Advised Fund or a Private Foundation” for a further comparison.
Q: My company granted stock options to me as part of my compensation and the value of the company stock is now well above the strike price of the options. Are there benefits to me donating the options to a donor advised fund?
A:Employee stock options can be difficult assets to give to charity. These options generally come in two types: incentive stock options (“ISOs”) and nonqualified stock options (“NQSOs”). ISOs, by their terms, may not be transferred by an employee during life, which precludes giving these options to charity. Individuals holding NQSOs should first consult the company plan governing the options to determine if a transfer to charity is allowed. Even if a lifetime transfer of NQSOs to charity is permitted, the tax consequences to the donor may not be favorable. This is because an individual cannot transfer the income tax consequences of NQSOs, even if the options themselves are transferrable. Thus, if an individual donates NQSOs to charity and the charity later exercises the options, the donor will still recognize ordinary income associated with the exercise of the options even though the charity then owns them. A bequest at death of NQSOs to charity can, however, produce a more attractive result as the donor’s estate typically would not recognize income when the charity exercises the options. Please contact your own tax advisors for additional information.
Q: My accountant asked me to give him tax information for my gift to Morgan Stanley Global Impact Funding Trust (“Morgan Stanley GIFT”) last year. Where can I get it?
A:Donors to Morgan Stanley GIFT can access extra copies of contribution receipt letters online by logging in to his or her account and going to the page called Contribution Activity.
A donor who contributes to charity non-cash property worth more than $500 will need to file Form 8283 with his or her income tax return in order to substantiate the deduction. Non-cash property includes publicly-traded securities in addition to assets like insurance policies, real estate and closely-held business interests. The donor (or his or her tax preparer) is responsible for completing this form. Unfortunately, Morgan Stanley GIFT cannot complete or review Form 8283 for its donors. Please contact your personal tax advisors for additional information.
Q: Where can I learn more?
A: Please read the Donor Circular and Disclosure Statement on our website, which provides detailed information about MS GIFT’s donor advised fund program.