2016 Charitable Giving Tips
This is the season to give thanks and to share our many blessings with those less fortunate. You can open your heart and be tax efficient as well. Here are a few simple ideas that you might consider before the end of the year:
- Go through your closet and find those items you don't wear or don't fit anymore. Take them to a charitable organization that provides receipts. Reasonable deductions can be taken and many will benefit from your closet clean out.
- Gift appreciated stocks rather than cash to your favorite charity. You can avoid paying capital gains tax on the appreciation and since the charity does not pay tax on the stock sale, it will end up with the same dollars as they would have if you had written a check.
- Gift some, or all, of your Required Minimum Distribution (up to $100,000) directly to charity. This gifting technique was made permanent in 2016. You don't get a tax deduction for the gift, but you also don't have to recognize the gifted portion of your RMD as 2016 income.
- Start a family tradition. Let each member of the family research a favorite charity and present their rationale as to why their charity should be chosen to receive this year's family donation. Select a dollar amount that would be equivalent to the amount that would have been spent on a gift for each family member. Conduct a family vote and donate the funds to the charity with the most votes.
There are many other ways to be part of the community and give back. These are just a few win/win examples that make 'cents.'