Join Eric Brotman and Jeff Dudley for a conversation around four tax-smart strategies to help you maximize your philanthropic giving in a way that reduces your tax bill and lets you leave assets to your children or grandchildren.
This webinar covers an array of topics aimed at helping you optimize your charitable giving. We start with Eric Brotman walking us through the nuances of qualified charitable distributions (QCDs) and the benefits they offer and the significance of non-cash contributions and the strategic use of appreciated securities. Jeff Dudley ties it all together by highlighting the importance of proper beneficiary designations and planned giving. The conversation emphasizes the benefit of consulting financial advisors, CPAs, and legal advisers to navigate the complexities of tax-smart philanthropy effectively.
Key Takeaways:
Qualified Charitable Distributions (QCDs): Individuals aged 70 and a half or older can donate directly from their IRAs to a charity, avoiding income taxes on the distribution. This strategy is particularly advantageous for those subject to required minimum distributions (RMDs).
Donor Advised Funds (DAFs): DAFs are powerful vehicles for tax-efficient charitable giving. They allow contributions to be pooled, offering tax deductions in high-income years, while distributing funds over time. This flexibility makes DAFs accessible, even for smaller annual contributions.
Non-Cash Contributions: Donating appreciated securities instead of cash can have significant tax benefits. This approach helps avoid capital gains taxes while allowing the donor to make impactful contributions. Rebalancing your investment portfolio is a timely opportunity to make these donations effectively.
IRA as Charitable Giving Vehicle: Using IRAs for charitable donations is highly effective as it bypasses taxes that would otherwise burden heirs. Charities receive the full benefit of the donation tax-free, making IRAs a strategic option for philanthropy, especially considering RMD obligations.
Estate Planning and Beneficiary Designations: Beneficiary designations on accounts like IRAs and HSAs override instructions in a will. Ensuring correct beneficiary designations is crucial to manage potential tax burdens for heirs and to fulfill philanthropic intentions. Regularly reviewing these designations is essential.
