The year is winding down! Where did 2024 go?
The team at the community foundation is here to help you navigate your charitable giving priorities all year round, and especially during the giving season when we know many of you are beginning to turn your attention to tax planning and ensuring that you’ll meet your charitable goals before the end of December.
Here’s what’s trending:
–Year-end is fast approaching! We’re providing three important tips to consider as you evaluate where you stand with your charitable giving goals for 2024 and review your tax situation with your advisors. Whether you’ve already established a fund at the community foundation or are considering it, we look forward to hearing from you.
–The community foundation is our region’s trusted source for all things philanthropy. We are honored to serve you and your family as you pursue the charitable endeavors that mean the most to you. Learn how our team helps structure your giving in ways that respect your desire for trust in the impact your dollars can make.
–Charitable giving is important to couples whether or not they have children. Discover how the community foundation can help you serve your clients’ charitable intentions to support our community across generations in situations where heirs will be involved and in situations where there are no heirs. We’re here for everyone!
Wishing you all the best for a safe and happy Thanksgiving!
With Gratitude,
Angie Tatro, CEO
A trio of tips to wrap up 2024
Year-end is closing in, and it’s easy to get overwhelmed by all the advice floating around about what to do before December 31. We’re making it super easy for you! Here are three reminders that typically are among the most important for year-end charitable giving.
–Give stock. Evaluate your highly-appreciated stock positions and use these assets to give to your fund at the community foundation, coordinating with your tax and financial advisors to optimize your 2024 goals. Appreciated assets generally are far better charitable gifts than cash because you not only can take advantage of the income tax deduction, but also you can avoid capital gains tax.
–Use your donor-advised fund. Consider deploying a “bundling” or “bunching” technique by making a gift to your donor-advised fund at the community foundation this calendar year that allows you to leverate itemized deductions (the standard deduction is very high, at least at the moment), and then use your donor-advised fund over the next few years to support your favorite charities.
–Explore a QCD. If you are age 70 ½ or older, you absolutely must consider making a Qualified Charitable Distribution (“QCD”) to a designated or field-of-interest fund at the community foundation. Each spouse can give up to $105,000 in 2024, and the distributions will satisfy your RMDs if you’ve also reached that age. Contact the community foundation right away to learn why the QCD is so powerful. Note that your donor-advised fund is not an eligible recipient, but there are lots of other ways you can leverage this tax-savvy giving opportunity.
November is the time to set things in motion so you don’t get caught up in the year-end rush. Reach out to the community foundation team today! We are here for you!
Fostering trust and making a difference
Many people are not aware of the extent to which America’s charitable organizations help improve quality of life in our communities. From social services to the arts, virtually every aspect of our lives is touched by the work of nonprofits. Indeed, the gifts Americans give to charity every year total more than $557 billion and provide critical support for nearly 1.5 million organizations that are helping communities thrive.
Research shows that trust continues to be an important factor in charitable giving. Unfortunately, high levels of trust sometimes can be hard to achieve; 73% of donors surveyed said they felt that it is very important to trust a charity before giving, but only 19% say they highly trust charities.
So what should you do if you know you want to support a particular organization but you’ve not quite yet gained a level of trust to go “all in?” Or what if you want to support an overall area of community need but you’re not sure which organizations are best aligned with the results you want your charitable gifts to achieve? Or what if you’re fairly certain you know the specific organizations that are addressing your areas of interest right now, but you’re concerned that this “fit” might change over time as needs shift and charities evolve?
The community foundation can help in situations like these and many others like them. Here are three examples:
–If you’ve established a donor-advised fund at the community foundation to organize your giving, lean on the team at the community foundation for insights into which charities are best suited to achieve your goals for impact at any given time. Our team stays up to date on local charities, their priorities, and their programs and staff. We can provide information and insights to help you make informed decisions.
–If you’re committed to supporting a specific charity but you’d rather not give the money outright, you could consider setting up a designated fund at the community foundation to make distributions to the charity according to parameters you set. Because the charity receives the money in increments every year, charitable dollars remaining in the fund are protected from the charity’s creditors if the charity were to fall on hard times.
–If you’d like the community foundation to help out even more, you might consider establishing a field-of-interest fund so that the community foundation team can deploy its expertise in selecting charities that are best suited from year to year to achieve your goals for community impact.
–To ensure that the mission of the community foundation itself stays strong and that dollars will flow to support critical community needs for generations, you can establish an unrestricted fund at the community foundation. You can add to the unrestricted fund during your lifetime, such as through gifts of appreciated stock, and you can also include a gift to the fund in your estate plan through your will or an IRA beneficiary designation.
The community foundation is unique in its structure as a perpetual institution governed by an independent board of directors. Our mission is to improve the quality of life in our region across generations by connecting donors to the causes they care about and leading on critical community issues. We’re honored to work alongside you and your family as you build trust with the charitable organizations that are making a difference for everyone who lives and works in the community we love.
Generational impact, with or without children
At the community foundation, we’re honored to work with our donors and fund holders to achieve a wide range of charitable giving priorities often involving multiple charitable giving vehicles. It’s not uncommon, for example, for an individual’s or couple’s “portfolio” of philanthropy with the community foundation to look something like this:
–A donor-advised fund to make it easy to donate appreciated stock and organize annual giving to favorite charities.
–A designated fund to support the mission of a particular charity over the long term, especially because when one spouse reaches the age of 70 ½, the designated fund can receive tax-savvy Qualified Charitable Distributions from IRAs.
–A beneficiary designation on an IRA to leave those assets to an unrestricted fund at the community foundation, avoiding both income tax and estate tax, so that the fund can support the community foundation’s mission in perpetuity.
What’s more, many people don’t realize that a mix of charitable giving vehicles works well to achieve your charitable goals whether or not you have children. For example, if you have children, you can work with the community foundation to explore naming them as successor advisors on your donor-advised fund to carry on your philanthropic priorities beyond your lifetime. If you don’t have children, your donor-advised fund can roll into your designated fund or unrestricted fund following your death.
Changing demographics are becoming a catalyst for the community foundation’s increased role in many estate plans. For example, not having children is becoming more common, both among millennials and older people. According to a study conducted by the Pew Research Center, 20% of U.S. adults age 50 and older hadn’t had children. In addition, children of affluent parents tend to move away, which means that many parents embrace the notion that working with the community foundation can help children maintain ties to their childhood community even across generations.
Indeed, many couples who don’t have children and couples who do have children feel a strong sense of peace of mind knowing that the community foundation will be involved with their charitable legacy long after their lifetimes, whether through advising children and grandchildren or administering charitable bequests for maximum community impact. The community foundation always has its finger on the pulse of our region’s greatest needs and the nonprofits that are meeting those needs at any given point in time, whether right now or decades in the future.
Please reach out to the team at the community foundation to learn more about how we can help you leave a legacy across generations, whether or not you have children. We’re here to help!
The team at the community foundation is honored to serve as a resource and sounding board as you build your charitable plans and pursue your philanthropic objectives for making a difference in the community. This newsletter is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice. Please consult your tax or legal advisor to learn how this information might apply to your own situation.
