Best Assets for Giving
IRA Qualified Charitable Distributions
IRA owners age 70½ and older have the ability to make charitable gifts directly from their IRAs of up to $100,000. Income tax deductions are not available for IRA "qualified charitable distributions" but donors may save taxes anyway, where gifts take the place of required minimum distributions, which are generally 100% taxable. Note: This gift strategy first became available for the tax year 2006, but has been renewed by Congress annually since then, on a one-year basis. Please check with us on current availability of this gift technique. It's important that you coordinate IRA contributions with our office. We will need to provide you and your IRA custodian with important information and ensure that you receive appropriate tax receipts.
Cash
Cash is a frequently
used asset for all forms of charitable gifts and provides the
most immediate deductions. Every dollar you give will be deductible
up to 50% of your adjusted gross income, if you "itemize."
Excess deductions can be carried over and deducted in up to five
future years. A $10,000 contribution saves $3,500 for a person
in the 35% tax bracket, $2,500 for someone in the 25% bracket.
Tax savings are not the reason friends support our endeavors,
of course, but they do enable supporters to do more than
they might have thought possible.
Investment Assets
People often are
surprised to learn that there are different tax results from
giving different types of property. Gifts of highly appreciated
securities, for example, may be particularly favorable. If stocks
have been owned more than one year, then donors can deduct not
just their original cost, but also any "paper profit"
present in the gift. Best of all, there are no capital gains
taxes due when you give securities. Mutual funds and other types
of investments offer the same advantages.
Call us to discuss this gift option.
Real Estate
The tax benefits
available for gifts of highly appreciated real estate are virtually
identical to those for gifts of securities that have gone up
in value. First, you avoid capital gains tax on your profit.
Second, you receive an income tax charitable deduction for the
full fair market value of the property you contribute. Call us to explore this opportunity.
Collectibles
Some of our friends
find they have "hidden assets" that can help them in
satisfying their philanthropic goals. Antiques, paintings and
other "collectibles" – even patents and copyrights – can be valuable assets for giving. In many cases, the same favorable
tax rules apply to these gifts that apply to securities and real
estate. Please check with us on the feasibility and tax results
of gifts of unusual items. Call us to talk aboutgifts of collectibles.
Business Interests
Many of our friends
own stock in their own businesses that can be given at extremely
low cost, providing personal deductions that are "paid for"
by the company.
Call us before you sell your business, sell
replacement stock from an employee stock ownership plan (ESOP)
or plan for passing your business to the next generation. |