Tue, 17 Aug 2010 14:01:22 GMT
What is Planned Giving?
Planned Giving is a set of ways an individual can set aside part of his wealth for a charitable cause- either during his lifetime or after his death. The donor does not have to pledge cash; in many instances real estate and stock options may also be set aside for philanthropic causes. In Islam, Planned Giving is known as waqf.
Unlike a simple donation, Planned Giving allows for the donation to be used by the respective cause over a period of time. This provides the donor a multitude of options as to how to structure his gift so that, while aiding in a charitable cause, he can also reap benefits such as a continuous source of income or tax cuts.
Is Planned Giving important in Islam?
Indeed, charity is highly revered in Islam. The fact that Zakat is a pillar of Islam illustrates the importance Islam attributes to spending for charity.
The Quran has time and again stressed the importance of this virtue:
"Spend (in charity) out of the sustenance that We have bestowed on you before that time when death will come to someone, and he shall say: "O my Lord! If only you would grant me reprieve for a little while, then I would give in charity, and be among the righteous." - Quran, 63:10
The Prophet Muhammad, peace and blessings be upon him, also spoke highly of philanthropy:
"The believer's shade on the Day of Resurrection will be his charity."
- As reported in Al-Tirmidhi, Hadith 604
Planned Giving is a form of Sadaqah Jariyah, was also held highly by the Prophet:
"When a man dies, his deeds come to an end except for three things: Sadaqah Jariyah (ceaseless charity); a knowledge which is beneficial, or a virtuous descendant who prays for him (for the deceased).''
-As reported in Muslim
How important is estate planning for Muslims?
It is part of one's religious obligation to make sure that one's debts are settled and wealth is distributed upon death. To that end, some type of estate planning is required. This is especially relevant to Muslims living in the United States. If an individual dies intestate, i.e. having no will or plan to his name, his wealth will be evaluated and apportioned by the state courts. This apportionment may not keep in line with Shariah law, so it is highly recommended that Muslims who wish to abide by the tenets of Islam at the very least have a Last Will and Testament.
How will creating a will help me in Planned Giving?
Creating a will can facilitate any wealth you want to dedicate to a philanthropic cause after you come to pass. A will can explicitly state the amount of your wealth you want donated, the cause/s you want it donated to, and the type of donation you prefer. This allows for a great deal of flexibility, allowing you to plan for your family as well as society- all while staying within the bounds of the Shariah.
What are the different forms of Planned Giving?
Helping fund a mosque, donating to an Islamic organization, providing to a charity and aiding in the establishment of a school all fall under the umbrella of Planned Giving. However, the methods used for the donation vary along with the benefits associated with each method.
Some methods of Planned Giving include:
- Outright Gifts: These are direct donations to the organization of cash, stock, or property.
- Gifts by Trusts Beneficiaries: A beneficiary of a trust can transfer his entire life-income interest to an organization. This will enable the donor to receive an income tax charitable deduction.
- Charitable Lead Trusts: This involves a donation providing a stream of income to the organization for a stipulated period of time. After that period is over, the asset is returned back to the donor or his beneficiaries.
- Gifts of Life Insurance: These may take a number of forms. The simplest form calls for the donor to name his preferred organization as a beneficiary of his life insurance policy. Upon death, the organization receives the proceeds from the insurance policy.
These are a few of the forms Planned Giving can take. It is up to the discretion of the donor which method suits his financial situation and commitment the best.
Frequently Asked Questions
What distinguishes Planned Giving from other types of donations?
Planned Giving essentially differs from other forms of charity in that it is structured. A sum donated to an organization will not classify as Planned Giving unless it is to be used over a period of time.
What is the minimum amount that can be planned for?
There is no minimum. Individuals can plan for philanthropic causes keeping in mind their financial situation.
Can I only give to non-profit organizations?
Planned Giving usually involves providing to not-for-profit organizations at the very least- for instance, educational institutions, charitable organizations, Islamic centers, mosques, etc.
What forms do I need to fill and how much will the process cost me?
It depends upon the nature of the donation. A provision in one's will pledging a sum to an organization is simple and costs nothing. As the financial structure of the donation gets complicated (such as in the case of Pooled Income Funds and Charitable Remainder Trusts), however, the need for an attorney may arise.
Are there any organizations that help individuals plan for their estate and aid in Planned Giving endeavors?
Yes; The ISNA Development Fund is an organization dedicated to Planned Giving for charitable causes. The Saturna Trust Company acts as a liaison between individuals and legal representation. Amana Mutual Funds is a Shariah-compliant investment company.
Remember the Council in your prayers and your Planned Giving
The Council is a federation that has united 63 member organizations towards working for the common good. Its mission is to strengthen and empower its members, to coordinate their efforts, to effectively represent the concerns of the Muslim community, and to build better relations between Muslims and the greater Chicago Community.
By including the Council in your Planned Giving, you will be contributing towards the unity of the Illinois Muslim community and towards a model that other Councils across the United States can emulate.
The Council provides a range of services, including:
- Civic Engagement: Placing Muslim community leaders on local, city, and state boards and commissions to promote integration of the Muslim community in the civic arena. Coordinating annual Illinois Muslim Action Days where citizens get to meet their legislators and advocate for issues they feel strongly about.
- Youth Development: Coordinating efforts of weekend schools and youth mentors and providing resources about Islam to public schools are just some of the prongs of the Council's active Youth department. MSA Unity programs, service projects that tie in faith and action as well as developing interns as future community leaders have been well-recognized and well-received programs of the Council.
- Building Alliances: Connecting Muslim leaders to peace movements, government, and religious organizations.
- Communication: Publishing a unified voice of the Muslim community and distributing 10,000 copies free of charge to 130 locations monthly. Providing the Muslim voice for mainstream media queries and connecting the community through electronic listservs.
For the past 18 years, the Council has been working tirelessly towards a more cohesive community. When you include the Council in your Planned Giving options, you will be helping the Muslim community for generations to come, insha Allah.
Find out more about what the Council has accomplished, what it is currently offering and future plans by visiting www.ciogc.org, subscribing to our weekly e-newsletter and monthly Chicago Crescent and by following us on Facebook and Twitter
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