End of Year Tax and Donation Considerations

  It has been the busiest week of the year for charitable gifts and gift arrangements. New donors have established funds and donors we've been working with for years are solidifying year-end giving with completed gifts of cash, stock, and property in anticipation of the December 31st year end. I’d be remiss this early in December if I didn’t remind everyone (although we are all aware) that we are hurtling toward the end of the year. Along with our Christmas shopping and party planning, we are running out of time for our year-end gifting. The tax changes that were recently implemented affect higher earners and include higher tax brackets and capital-gains rates. In addition a Medicare surtax on investment income and new limits on deductions are providing increased incentives for tax savings and avoidance for donors this year. These changes don’t drive charitable gifting (which in our experience is much more related to a donor’s desire to do good), but increased tax benefits certainly don’t hurt. Most of the gifts we receive at year-end are appreciated investments that provide complete avoidance of capital-gains tax while also getting a tax deduction of up to 30% of adjusted gross income. Although most of these gifts are of appreciated stock and mutual funds, the Community Foundation is able to accept a wide variety of appreciated assets. So if you are a generous person who has an appreciated asset that is perhaps real or personal property, and you’d like to make a gift prior to the end of the year, now is the time to call. By “funding” a donor-advised fund, your gift can grow tax-free until you specify a charity to receive some or a part of the gift. The tax changes combined with the rising stock market and increased property values makes 2013 a surprisingly great year to make a charitable gift. Please also note that investors 70½ and older this year can give up to $100,000 directly to charities from their individual retirement accounts, fulfilling their required minimum distribution without having to draw taxable income. If you’d like more information on year-end giving; please give us a call. We make philanthropy simple, powerful, and effective. Chris Askin, President & CEO, Cell is 775.762.1932