Charitable Giving

When we give, it can be the $20 thrown into a collection or perhaps the $100 we gave to a registered charity with a charitable receipt provided back to us to acknowledge our contribution.

Alternatively, one can give thousands, tens of thousands, or more if they so desire.  However, the icing on the cake is the combined tax credit of 50% for every dollar contributed after the first $200 contributed every year. Therefore, the real cost is only 50 cents on every dollar given. In fact, with other special gifting rules that exist you may also be able to avoid the capital gains tax on the gifting of certain investments to charities. Starting in 2016 the credit may be even more than 50% if your taxable income was over $200,000 in the year.

The tax savings can be a great planning tool to use when looking at current and future tax liabilities. In fact, one of our Wealth Advising partners, was able to evaluate a client’s situation and it became clear that a tremendous opportunity existed in using a gifting strategy.

The client had not previously made any really large donations, but through education & analysis saw the benefits of implementing charitable giving into their wealth management plan.  In their situation, the contribution was going to be large enough for the client to set up a Donor Advised Fund or DAF.  A DAF can be set up in the name of anyone which allows you to create a legacy in someone’s name if you so choose.

By choosing to give through a DAF they will be able to provide funding to different charitable organizations that they desire to support, in different amounts and at different times of the year.  They will have the simplicity & benefits of using the Donor Advised Fund along with the tremendous tax planning advantages of a charitable donation.

Whether your inclination is to give thousands, tens of thousands or more, either directly or through establishing your own Donor Advised Fund, the benefits to you and those whose lives you will impact will provide immeasurable returns.

Let us know if you would like more information on how giving can be a benefit to you.  Please feel free to contact us at 780-466-6204 or email us by clicking here.

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