September 2024
Financial Planning

Charitable Giving – Hold That Pen!

By Myra Alport

Americans are among the generous when it comes to donating to their favorite charities. As income across the board rises, more of us make gifts to charitable causes

Before you grab that pen to write out your checks before the end of 2024, here are some potential tax-savings options for making those gifts when it comes to your federal taxes.*

Donate Appreciated Assets

In 2024, we have seen a lot of appreciation in individual stock positions. Instead of selling those assets and donating the cash, consider donating the stock directly to the charity. This allows you to avoid paying capital gains while still claiming a charitable deduction for the full market value of the asset. These positions must be held in taxable accounts and have long-term capital gains.

Qualified Charitable Distributions (QCDs)

If you are 70-1/2 years or older, you can make a QCD directly from your IRA to your favorite charitable cause(s). If you are of Required Minimum Distribute (RMD) age, these distributions count toward your RMD AND are excluded from your taxable income.

Bunching Donations

You can maximize your deductions by bunching two or more years’ worth of donations into one year. This can push you over the standard deduction threshold, allowing you to itemize and receive a larger tax benefit.

Donor-Advised Funds (DAFs)

Contribute to a DAF to receive a tax deduction in the current tax year. From there you have the flexibility to decide when and where you want the funds to go in future years.

Please contact your advisor with your questions related to charitable donations. We can utilize our tax planning software to determine your most beneficial tax savings option.

*State tax credits to charitable organizations apply to your state tax return only.

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