Thanksgiving is right around the corner, which means the season of giving is upon us. As you make plans for your 2021 charitable donations, here are three smart generosity strategies to discuss with your professional advisor.
First, many of your favorite organizations may offer a matching gift challenge this time of the year. This is a quick and easy way for you to double your gift and double your impact. At the Community Foundation, we have donors who have established matching gift challenges for the following funds that we manage:
Second, donors who gift appreciated stock or other non-cash assets to support their favorite nonprofit organization realize significant tax advantages. Because a nonprofit organization, like the Community Foundation, is tax-exempt for federal and state income tax purposes, it will not pay capital gains taxes on the appreciation. This means that more money will be available for charity. Considering the recent run-up of the stock market, many donors have appreciated stock in their portfolios, and this strategy will help them maximize their tax benefits while generating a larger gift for their favorite charity.
Third, many donors who otherwise would not qualify to itemize their deductions have found a way to do so by “bunching” or pre-funding several years of charitable donations into the current year by creating a donor advised fund managed by the Community Foundation. This allows the donor to qualify for itemized deductions in year one but still distribute their donations to charity over several years. This simple strategy can result in significant tax savings.
Our goal is to help donors be generous however that looks for them. We would be honored to work with you and your professional advisors to craft a generosity plan that works for you! If you would like to discuss further, please contact me at email@example.com.