Giving Options in Bunches
April 5, 2018
by Kaye Englin, President & CEO
Many Americans are assessing their charitable giving in light of the new Tax Cuts & Jobs Act passed in December 2017. The importance of charitable giving has never been more pronounced, and the generosity of people remains essential to keeping our communities strong. The Community Foundation of Northeast Iowa is a partner in your charitable efforts, offering tax-wise strategies that help you best support the causes that matter most to you.
One strategy often referred to as bunching, may be a solution for donors who might not reach the new standard deduction limit every year. This strategy, coupled with the benefits of a donor advised fund through the Community Foundation, can be a tax-wise giving vehicle.
Donors can “bunch” their charitable contributions into their own named donor advised fund in one calendar year, setting them over the standard deduction limit. The fund then allows donors to continue to direct gifts to the causes they care about, potentially maintaining their previous contribution levels and timing.
A second strategy known as accelerated bequests, may also be a great solution for a donor who plans to leave a gift in their Will to charity. With the increased estate tax exemption, it may be tax-wise to accelerate the gift during their lifetime. Many tools through the Foundation are available to fulfill the donor’s charitable wishes.
Several other great charitable giving options unaffected by the new law remain attractive options for reaching your charitable goals. Gifts of stock and real estate are tax-wise options. Stock transfers are simple and save donors the capital gains. Another option for donors 70 ½ or older is the IRA charitable rollover, regardless of whether the donor itemizes their taxes. Donors can roll their minimum distribution requirement, up to $100,000, directly to the Community Foundation to support a fund, income-tax free.
CFNEIA always recommends you consult with your financial advisors to consider how you can best maximize tax benefits and continue supporting the causes you care about. Please use us as a resource to learn more about how you can develop tax-wise charitable giving strategies to support the causes that matter to you now, and for generations. Contact us to learn more.