Charitable Giving and Tax Benefits

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Do you have a charity that is close to your heart? Maybe your church, your favorite animal shelter, or your alma mater. Consider including them in your estate plan and/or in lifetime gifts. If you don’t have a particular charity you want to support, but there is a cause that is important to you, like homelessness, animals, kids, education, arts, just to name a few, giving to a community foundation may be a good fit for you. If you don’t have a preference either way, consider giving to local charities, local community foundations, or the local or regional chapter of a national charity to keep your support in your community.

In addition to making you (and the charity) feel good, there may be tax benefits to you. Gifts to charity typically provide a tax deduction to you or your estate in the year of the gift. If the gift is large, the tax deduction may carryover for several years while you are alive. If you are required to take distributions from an IRA that you do not need to live on, you can direct up to $100,000 per year to be distributed directly to a qualified charity and exclude the distribution from your income. This results in a lower tax bill for you and a larger gift to charity because there is no income tax consequence to you or the charity.

Similarly, it can be beneficial to give appreciated stock or land to charity during your life, or to designate charities as beneficiaries of pre-tax assets, such as 401(k)s and IRAs, at your death because charities are not subject to capital gains or income taxes on the sale of these assets.

There are many good causes and many ways to give. We can discuss what may best suit you.  Call our office today to schedule an appointment to discuss your options.