Finance Monthly speaks to the Director of the Financial Planning Program at Stephen F. Austin State University - Banker Phares, who has been licensed to practice law in the State of Texas since 1964. He was founding member of the Estate Planning and Probate Specialty for the State Bar of Texas in 1977 and still holds that specialty certification which is renewed every five years. Representing individuals, businesses, and foundations interested in charitable giving, he provides advice concerning the amount, structure, use, and deductibility of charitable gifts.
What do you think prompts charitable giving in the US?
In 2017, I wrote an article on Charitable Giving in the United States. Using a report published by Giving USA Foundation, I found that charitable gifts in the United States totaled $410.2 billion in 2017. The percentage breakdown is as follows: 70% was given by individuals, 16% by foundations, 9% by bequests at death, and 5% by corporations.
A study by The Comparative Nonprofit Sector Project sponsored by Johns Hopkins Center for Civil Society Studies made a study of the level of giving by different countries. According to that study, the level of giving is determined by comparing the giving to the Gross Domestic Product (GDP) of a country. Using that test, individuals in the United States gave 1.85% of the GDP, Israel gave 1.34%, and Canada gave 1.17%. When volunteerism is the sole criteria, the study concludes that the Netherlands is first, followed by Sweden and then the United States.
Using a report published by Giving USA Foundation, I found that charitable gifts in the United States totaled $410.2 billion in 2017.
It is difficult to determine why a business makes a charitable contribution. From my 54 years of experience, I know that some do it for public relations purposes and some do it out of social conscience. I have listened to discussions where leadership groups “cherry pick” charitable organisations – not for altruistic purposes - but for the favorable publicity. Regardless of motive, the charities benefit.
What should businesses be mindful of when supporting charities?
Businesses should be very selective, and should examine the annual filings of the charity to determine the reputation of a charity and the amount a charity uses for charitable purposes. A large business has the opportunity to make a substantial contribution thereby allowing a charity to carry out charitable purposes it otherwise would be unable to undertake.
Businesses should be very selective, and should examine the annual filings of the charity to determine the reputation of a charity and the amount a charity uses for charitable purposes.
About Banker Phares
Banker Phares graduated from the Southern Methodist School of Law with Juris Doctor Degree in 1964, and, while there, served on Board of Editors of Southwestern Law Journal, and as a member of the Barristers. He became Board Certified in Estate Planning and Probate Law in 1977 by the State Bar of Texas. He is the Director of the Financial Planning Program at Stephen F. Austin University, and teaches in the Department of Economics and Finance. He is the John and Karen Mast Professor. He is also the Director of the Marleta Chadwick Student Financial Advisors, organised to the purpose of informing students and the public with the need for financial planning.
Banker Phares is engaged in Solo practice of law in his area of specialty with law offices in Beaumont and Nacogdoches, Texas. He has designed charitable estate plans which include gifts to universities as well as public and private foundations. He has also created public and private foundations as a component of estate plans. The gifting methods utilised include direct gifts of cash and other property to charitable lead and charitable remainder trusts, and the design of conservation easements.
Among the thousands of individuals, charities and businesses’ making donations towards hurricane Harvey relief, and in the wake of another pending hurricane in the Caribbean, KPMG has teamed with brand ambassador Stacy Lewis this weekend to make a combined donation of $390,000 to support Hurricane Harvey relief efforts. This follows Lewis' win at the Cambia Portland Classic where she donated 100% of her tournament winnings.
Stacy Lewis was raised and currently resides in the Houston, TX area and Lewis' husband, Gerrod Chadwell, is Head Golf Coach for the University of Houston Women's Golf Team. Stacy dedicated her play on this week's LPGA Tour tournament to relief efforts, which KPMG matched. Asked what the week has taught her, Stacy reflected: "Being more appreciative. It definitely puts things into perspective."
This win marks Stacy's 12th on the LPGA Tour and first victory since 2014. In addition to KPMG's donation to relief efforts, each time a KPMG Brand Ambassador wins on Tour, KPMG makes a donation of books and refurbishes a local library as part of KPMG's Family for Literacy (KFFL) initiative. To honor this special win by Stacy, KPMG will double the typical donation with 10,000 new books to be provided to children and local KPMG volunteers will refurbish two libraries in the Houston area.
KPMG US Chairman and CEO Lynne Doughtie said: "In times like this, coming together to support one another matters the most. We are touched by the generosity displayed by Stacy, and so many across the country, to help those impacted by Hurricane Harvey."
In addition, KPMG has pledged to match partner and employee contributions up to $400,000 to the KPMG Disaster Relief Fund to provide Hurricane Harvey relief.
(Source: KPMG LLP)
