(MONEY Magazine) – When it comes to helping others, Americans are undeniably generous. Last year, according to the Independent Sector, a nonprofit group that studies Wtrends in philanthropy, the average household gave $734 to charity, up an inflation- adjusted 20% over 1987. Many benevolent spirits give much more, such as Kenneth Schwartz, 64, a builder in Hollywood, Fla., and his wife Maxine, 52, who give away about $25,000 a year, or 10% of their gross income. Explains Kenneth Schwartz: ''By our actions, we hope to teach our children to accept their share of responsibility in the community.'' Like the Schwartzes, most donors expect to receive only the satisfaction that comes from doing good -- plus a tax write-off if they itemize deductions. But increasing numbers of Americans are discovering that with a little bit more effort, they can make their gifts through charitable trusts and other relatively simple strategies and get a much bigger tax payoff -- and in some cases collect income from the property they give away. Says Philadelphia attorney Frederick J. Gerhart: ''People are starting to realize that they can make a significant gift to charity without lowering their standard of living.'' The trend is evident coast to coast. At Pomona College in Claremont, Calif., for example, donations to the 50-year-old planned-giving program totaled $5.2 million last year, up 179% from 1985. And at Boston University, more people have asked about making gifts of real estate this year than in the past 60 years. You don't have to be a Rockefeller or a Ford to take advantage of these tactics either. For instance, Indianapolis physician Dale Benson and his wife Barbara, both 49, established a charitable remainder unitrust in 1988 to benefit Greenville College, which is their alma mater, as well as the Community Health Network and Methodist Hospital. The Bensons contribute $4,000 to the trust each year, giving them an annual deduction of about $750, which will rise as they grow older. Beginning in 1997, when three of their four children will have graduated from college, the couple plan to boost their contribution to $10,000 for each of nine years. When they reach 65, they will begin drawing about $14,400 from the trust annually, an amount based on their life expectancies. After both die, the three charities will split what's left -- an expected $416,000. ''This arrangement meets my needs exactly,'' says Dr. Benson. ''I can contribute an affordable amount each year, take a tax deduction, collect income after I retire and get the satisfaction of helping three charitable organizations that have had a strong positive impact on my life.'' Alas, unlike writing a check to your favorite charity, setting up a trust isn't a do-it-yourself project. You need an accountant, lawyer or financial planner to advise you on the tax implications of charitable giving, and their fees can range up to $1,500. If you decide to create a trust, you will have to hire a lawyer to draw up the trust agreement. Typical cost: $1,000 or more, depending on the size of your gift and complexity of the trust. To find qualified advisers, you might ask a reputable charity for names. (To help you select organizations deserving of your support, we list the 100 biggest charities in America on pages 159 and 160, ranked according to how much of the money they raise actually goes toward their charitable purposes.) When you meet with a tax adviser, first discuss how much you can afford to give to charity, because you can't take back your gifts. The techniques that we outline beginning on page 164 require as little as $1,000, though you could give much more. Tax law usually permits charitable deductions of as much as 50% of your adjusted gross income in any one year. You can, however, carry forward amounts that exceed the limit and deduct them on your tax returns over the next five years. You and your adviser should also discuss what you might give. Often it's best to donate appreciated property such as stocks or real estate. That way, because the recipient is tax-exempt, no capital-gains tax is due when the property is sold, and you get to take an income tax deduction for the full value of your contribution.

Make sure your tax adviser also looks into whether your gift would force you to pay the alternative minimum tax (AMT) -- a flat 21% in 1990, 24% thereafter -- which is intended to make sure that people with big write-offs still pay their fair share of tax. Because unrealized capital gains on gifts are counted in computing the AMT, a sizable donation -- say, one that resulted in a gain of $40,000 or more from someone with an AGI of $100,000 -- could trigger the tax. But the new tax law gives art collectors a break. In 1991 only, donors who give art or collectibles to museums may take an income tax deduction equal to the object's fair market value without incurring an AMT liability. Finally, your tax adviser can help you compensate your children or other heirs for the portion of your legacy that you give to charity. One option is life insurance for the amount that you give away. Your heirs should take out the policy on your life, but you could give them money to pay the premiums. Alternatively, if you're uninsurable or the premium is too costly, you can buy life insurance on one of your children for the benefit of your grandchildren. Once you've attended to those important details, you're ready to select a strategy and assume the role of Lord or Lady Bountiful. The following options are listed beginning with those that require the lowest minimum donations and start-up fees. Gift annuities. Donors with at least $1,000 to give who want to collect income from their gift should consider commission-free annuities offered by many charitable organizations, including the American Cancer Society, the Wilderness Society and Catholic Relief Services. Like annuities sold by insurance companies, gift annuities pay you a fixed amount each year for life. You may arrange for payments to start immediately or at some time in the future, such as after you retire. The longer you wait to collect, the bigger your tax deduction will be. For example, a 40-year-old who buys a gift annuity that will start paying him income at age 65 can write off 90% of the value of his gift. But a 65-year-old who buys an immediate annuity can deduct only 45% of his donation. Typically, half of the income you receive is considered a return of principal and therefore isn't taxable. Don't bother shopping for the highest payout because most charities use ) rates suggested by the Committee on Gift Annuities, which represents more than 1,100 tax-exempt organizations. One caveat: if your aim is to receive the highest possible income, buy an annuity from an insurance company and remember your favorite charity in your will. A 60-year-old could collect 7% for life from a charity but 8.5% or 9% from an insurance company, even after paying commissions. Pooled-income funds. If you want to give at least $5,000 and collect income from your gift, consider making a contribution to one of these funds, which are administered by colleges, medical research centers, religious groups and other tax-exempt organizations. Most charities that offer these funds don't charge a fee when you make your initial contribution and permit you to make additional gifts at any time. You and any other beneficiaries you name, such as your spouse or a child, receive a proportionate share of the fund's earnings for life; the principal ultimately goes to the charity. Well-managed pooled-income funds deliver returns comparable to those of mutual funds with similar investment goals. In addition, with a pooled-income fund you get a tax deduction of 25% to 50% of your donation, depending on your life expectancy and the fund's recent earnings history -- a higher return gives you a smaller write-off. Older donors get larger write-offs than younger ones because they can expect to collect income for fewer years. Before you contribute to a pooled-income fund, ask the fund for its annual report, which should include its investment results. ''Some charities produce abysmal returns of just 3% a year,'' warns Jim Corlett, a financial planner for IDS Financial Services in Winston-Salem, N.C. As a result, it's a good idea to comparison shop.

Charitable remainder trusts. These trusts offer you an income tax deduction and lifetime payouts but are suitable only for donations of cash, securities or other property worth $50,000 or more. Start-up fees are also hefty: $1,000 to $2,500 for an attorney to draw up a basic remainder trust document. You can also expect to incur annual appraisal, tax-return preparation and possibly trustee fees of $500 to $700, which the charity may pay. There are two basic types of remainder trusts. Annuity trusts pay you or someone you designate, such as your spouse or a child, a fixed annual income for life or a specified period of up to 20 years. After the recipient of the income dies, the trust's assets go to the charity. Unitrusts, on the other hand, shield the income recipient from inflation. You can specify that he or she collect a fixed percentage, usually 5% to 10%, of your trust's assets annually. Or you can opt to have the trust pay out the lesser of its annual income or a stated percentage of its assets. After the income recipient's death, the trust's principal goes to the charity. Because charities typically pay start-up and administrative costs, most prefer unitrusts of $100,000 or more. But it is possible to start one with a much smaller initial donation and add to it in subsequent years. Renaissance, a Carmel, Ind. charitable-giving consulting firm, sets up and administers unitrusts as small as $2,000 for an annual fee of $70 to $4,000, depending on the size of the trust. In addition to your initial contribution, you should intend to donate a total of $50,000 or more over 20 years. For example, Vivienne Gilbert, 46, a New York City tax attorney, and her husband Charles, 53, a jewelry designer, used Renaissance to set up a unitrust last year that will eventually benefit New York Law School, her alma mater. The Gilberts initially donated $2,000 and plan to kick in $250 a month until they retire. Gilbert views her unitrust as sort of a substitute IRA, since she expects to take income from it after she retires. Until then, she says, ''I get to deduct a portion of my gift (now 12.5%, but that will rise), there's no annual limit on how much I can give, and my trust's assets grow tax-free.'' Charitable lead trusts. If your aim is to preserve $100,000 or more for your heirs and you don't need income now, this trust may be right for you. You place assets in the trust, and the charity receives income from it until the trust terminates at your death. At that time, the trust's assets go to your heirs. You may get an income tax deduction by setting up a charitable lead trust, and you will be able to reduce, and maybe even eliminate, gift or estate taxes on the property that passes to your beneficiaries. Expect to pay an attorney at least $2,500 to draw up the trust document. Life-estate agreements. These arrangements are the strategy of choice for homeowners who crave an immediate tax deduction and don't need income. Here's how the agreement works: You give your house to a charity with the understanding that you will live there and pay property taxes as well as maintenance and insurance expenses until your death. You get a tax deduction ( based on the property's fair market value and your life expectancy, which you can use to offset up to 30% of your adjusted gross income. If necessary, you can carry the deduction forward for five years. When the house is sold after your death, the proceeds go to the charity. Sometimes you can even get more than a tax break. Consider, for example, Florence Mauro, 86, a widow in Berrien Springs, Mich., who managed to tailor a life-estate agreement to meet the needs of her extended family. Mauro gave her five-bedroom home to nearby Andrews University in 1976 but retained the right to live in it until she died. Thirteen years later, Mauro's granddaughter Nancy Gerard's husband Greg took a job at Andrews. The Gerards were having difficulty finding an affordable place to live, so Mauro asked the college to sell the house to the couple. The Gerards paid $60,000 for it and now live there with Mauro and their two children, Andrew, 4, and Allison, 2. Andrews used the cash it received for the house to endow the Charles and Florence Mauro Scholarship Fund. Concludes Mauro: ''This has been an answer to prayer.'' Bargain sales. You sell your property to a college or other tax-exempt organization for less than you could get on the open market and, as a result, get an income tax deduction that offsets your capital gain. You're most likely to interest a charity in a bargain sale if your house can be used for office space or you live in an area where real estate prices have boomed. Conversely, you can forget about this strategy if you own a handyman's special in a depressed area. Even charities occasionally turn down gifts.

CHART: NOT AVAILABLE CREDIT: NO CREDIT CAPTION: 20 CHARITIES THAT MAKE YOUR MONEY WORK HARDEST The two groups ranked here, led by Lutheran World Relief and Project HOPE, spent the greatest portion of their income in 1989 on their charitable mission, according to the NonProfit Times. The full record of the 100 biggest charities begins on page 159.

CHART: NOT AVAILABLE CREDIT: NO CREDIT CAPTION: SEVEN SMART WAYS TO GIVE Which of these commonly used strategies for charitable giving is right for you will depend on what you want to donate, how much it's worth and whether you want to receive income in return for your generosity.