Maximizing Your Charitable Contributions

At Standard Equity, we are passionate about exploring the numerous ways individuals can contribute positively to their communities while reaping tax and estate benefits. In this spirit, we are eager to share effective strategies that can enhance the impact of your charitable giving, aligning it with your broader estate and investment objectives.

Consider Donating Appreciated Assets

One powerful approach is to donate long-term appreciated securities. This includes stocks, mutual funds, bonds, real estate, or even private company stock. This method can often be more tax-efficient compared to cash donations, enabling you to extend your philanthropic reach.

The Benefits of Donor-Advised Funds (DAFs)

Another valuable strategy involves Donor-Advised Funds (DAFs). A DAF acts as a dedicated charitable investment account, allowing you to make an initial tax-deductible donation. This contribution can then grow tax-free within the fund, providing you with the flexibility to direct the funds to qualified charities over time.

Strategic Timing of Contributions

Timing your contributions can also maximize tax advantages, especially in years when your income is higher. Making larger donations during these periods can provide significant tax relief. This strategy pairs well with contributions to DAFs, optimizing both your charitable impact and financial benefits.

Qualified Charitable Distributions (QCDs)

For those aged 70½ years or older, Qualified Charitable Distributions (QCDs) offer a tax-efficient way to give. Individuals can direct up to $105,000 tax-free from traditional IRAs directly to qualifying charities. This option not only aids your chosen charities but also can satisfy your required minimum distributions (RMDs).

Key Best Practices for Charitable Contributions

When making any charitable donation, it is crucial to consider several best practices:

• Donate to Recognized Charities: Ensure your chosen charities are recognized by the IRS to qualify for tax deductions.
• Understand Deduction Limits: Be aware of the limits on charitable deductions, which can be up to 60% of your adjusted gross income.
• Document Your Contributions: Keep detailed records of all donations for tax purposes, including relevant receipts or documentation like W-2s for payroll deductions.

We hope this overview empowers you to make more informed and impactful charitable contributions. Should you have any questions or need further assistance, feel free to reach out to us at Standard Equity. We are here to help you make the most of your philanthropic endeavors.