Bright spots in the midst of economic challenges
Bear markets aren't much fun for anyone. But that doesn't mean your charitable giving commitments have to be put on hold. If you are like many donors, you are still looking for ways to support the organizations you care about that rely on your support to achieve their missions. Here are three smart giving tips to consider this month:
- Remember, not every stock is down. It's still incredibly tax-efficient to donate highly appreciated stock to your fund at the community foundation. When you give appreciated stock held for more than one year (a long-term capital asset) to your donor-advised or other type of fund, instead of selling it outright, the capital gains tax is avoided. Plus, marketable securities are typically deductible at their fair market value, further helping your overall income tax situation.
- Don't forget about the Qualified Charitable Distribution, either. If you've reached the age of 70 ½, the QCD is a simple and effective planning tool. You are still required to take required minimum distributions from your IRA even in a down market, and the QCD can help offset this tax hit by allowing you to direct up to $100,000* to a qualified public charity, including a field-of-interest fund or designated fund at the community foundation.
- This is also a good time to make sure your estate plan is in good shape, including bequests you may wish to leave to a fund at the community foundation so that the causes you care about can continue to be supported for generations to come. A bequest by way of a qualified retirement plan beneficiary designation is an especially effective tool to support your charitable intentions after you are gone. That's because funds flowing directly to a fund at the community foundation from a retirement plan after your death will not be subject to either income tax or estate tax.
To learn more about these giving opportunities, please reach out to our team. We're here to help!
*Beginning in 2024, the annual limit for QCDs will be indexed for inflation.
This content is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice.