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Philanthropy 831 Blog about the people and organizations invested in the future of Santa Cruz County.


Tax-Savvy Year-end Giving Tips
By Sam Leask / November 16, 2018

Foundation President Marilyn Calciano’s giving capitalizes on new tax law.

At the Community Foundation, we can help you think strategically about how you give and how to make our community a better place. We work to ensure that your donations make the greatest impact on the causes you care about while maximizing your tax advantages. As you look to make the most of your year-end giving, here are a few tips to keep in mind:

Give Appreciated Stock Instead of Writing a Check


"I was able to start our family fund at the Foundation by selling stock that had more than doubled in value over time. It was really easy to do, and I especially appreciated avoiding the capital gains since it was a charitable gift. Our fund will enable us to support great causes over many years." 

-Cynthia Druley, Foundation Trustee

If you have stocks or other publicly-traded securities that are worth more than what you paid for them, consider using these for your charitable giving this year.  

Let’s say you have stock which cost you $2,000 that is now worth $10,000. If you sold the stock and paid the tax on the $8,000 capital gain (which would be $1,600, if taxed at a 20% rate), you could then donate the sale proceeds and take a charitable income tax deduction of $8,400. 

But, if you give the stock directly to the charity for them to sell, you will avoid the capital gains tax, the charity will get $10,000, and your charitable deduction also will be the full $10,000. The Foundation can accept marketable securities of any kind. 

Charitable “Clumping” and the Use of a Donor-Advised Fund

With the new limits on the tax deductibility of state and local taxes and mortgage interest, you might be debating whether it makes sense to itemize, especially if your typical annual charitable deductions won’t add enough to help you exceed the new standard deduction ($12,000 for individuals, $24,000 for couples). 

Consider “clumping” several years of charitable donations into a single year and adding it to (or using it to start) a donor-advised fund. This will allow you to take an increased charitable tax deduction this year, and then advise distributions to your favorite charities in subsequent years, while also taking advantage of the increased standard deduction in those later years. 


“I love being able to get the tax benefit of year-end gifts with one simple transaction. I can check my year-end charitable giving off my to-do list, and then select the non-profits I want to support in a meaningful way over discussions with my family when things are less hectic.” 

 -Marilyn Calciano, Foundation Board President

 

 

Why not do both? Gifting Stock AND Using a Donor-Advised Fund

Not all charities are equipped to handle gifts of stock or other publicly-traded securities.  Community Foundation donors with advised funds enjoy the convenience of gifting appreciated securities to their funds, avoiding the capital gains tax, taking a deduction equal to full market value, and then advising distributions over time to the charities they wish to support.

Let us Do the Legwork

Working with the Community Foundation gives you access to our extensive knowledge of the local nonprofit community and the broad charitable needs of our county. That helps you stay informed about the organizations that you support and the effect your giving can have on the future of our community. We can set up a donor-advised fund for you in one meeting. 

We look forward to helping you make your giving easier, more effective, and rewarding, to create the lasting change you want to see in this community. To speak with our team, please contact Sam Leask, Philanthropic Services Director, at sleask@cfscc.org or (831) 662-2060.
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