Tips for Year-end Charitable Giving

By Kellie Smith, Jewish Federation & Foundation of Northeast Florida

It’s that time of year again, when many people add charitable giving to their busy to-do list! Year-end giving can come with great benefi ts and now is a good time to to make the most of them.

Take time to understand your tax liability for the year and whether you plan to itemize your deductions or claim a standard deduction. This can help you determine how much you want to give by December 31. It is always prudent before making any signifi cant charitable gifts to consult with an advisor to discuss the impact on your taxes and estate.

Learning more about the charity will help you feel confi dent that you are choosing eff ective organizations—and your support is really making a diff erence. Check with the IRS and Better Business Bureau to see if any complaints were fi led for an organization. You may also check ratings for an organization's performance on Charity Navigator. Only deductions to qualifi ed 501(c) (3) organizations are tax-deductible.

If you plan to send donations via check, make sure to mail early enough—a December 31 postmarked date ensures the gift counts for that tax year, even if not cashed until the following year. If paying be credit card, the transaction must be completed on or before December 31. If you donate stock, the transaction is only recognized once the transfer request has been submitted by your fi nancial advisor. The deadline for gifts of stock to the Jewish Foundation is December 29.

Consider giving long-term (held for more than one year) appreciated non-cash assets, such as stocks, bonds, and mutual funds. You’ll receive a charitable deduction for the current market value of the stock and eliminate capital gains tax, which may increase the amount available for charity by up to 20 percent.

If you are over 70½, you can make a donation directly from an individual retirement account to a charity. An IRA transfer generates neither taxable income nor a tax deduction, so you’ll benefi t even if you don’t itemize your deductions. Beginning in the year you turn 72, you can use your gift to satisfy all or part of your required minimum distribution.

A Donor Advised Fund off ers you an eff ective means to manage your charitable giving and involve your family in philanthropy. You’ll receive a charitable deduction for gifts to your fund in the tax year in which they're made, and you can defer grant making recommendations to any time you choose. All contributions are invested according to your risk tolerance, allowing them to grow over time, tax-free. It also makes record keeping a breeze and eliminates the burden of saving tax receipts.

Let us help you create an end-of-year giving strategy that will maximize both your philanthropic impact and your tax savings! Contact Kellie Smith, Foundation Director, today, to discuss your options: (904) 512-3796 or KellieK@jewishjacksonville.org

*This article is for informational purposes only and should not be considered fi nancial advice. Please consult with your own legal and tax advisors prior to making charitable giving decisions.