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Generosity Multiplied–Make the Most of your Charitable Giving
“If you have an opportunity to accomplish something that will make things better for someone coming behind you, and you don’t do that, you are wasting your time on this earth.” —Roberto Clemente
I can do this two ways. The obvious way is through my own personal charitable giving. The lesser known, but equally fun way is to help my clients make the most of their charitable giving. By that I mean optimizing the tax savings related to charitable giving.
Rule number one with charitable giving is to keep track of your receipts. For those who itemize deductions on their tax return, you can get a deduction for your charitable gifts. But you need to keep the documentation of those gifts.
As people start to make bigger gifts, then the planning gets more fun. You can move beyond cash (credit card/bank transfers) to giving away appreciated stocks. Once you’ve held a stock/mutual fund/ETF for more than a year, you can donate it directly to a charity and the capital gain disappears. You don’t have to pay taxes on the capital gain. The charity is tax exempt, so it doesn’t pay taxes either. That’s what I call a win-win because you still get the tax deduction for the full value of the stock you donated.
For those who give stock gifts to multiple organizations or have a multi-year gift they want to fund all at once, they should look at a donor-advised fund. It’s one of many good solutions that can cut down on the number of receipts you have to track and optimize the tax efficiency of your gift. This is a really cool, inexpensive way to start something similar to your own foundation, without all the headaches that come with an actual foundation.
That’s just a start to the creative ideas. You can expect more in a future blog post. And certainly reach out to me if you want to talk about your personal situation.[/fusion_text]
Legal Disclaimer: These posts do not constitute an offer or recommendation to buy or sell any securities or instruments or to participate in any particular investment or trading strategy. They are for informational purposes only. ASA gathers its data from sources it considers reliable. However, ASA makes no express or implied warranties regarding the accuracy of this information or any opinions expressed by the author and may update or change them without prior notification.