The 503-page tax law became effective this year on January 1. There is time before the end of this tax year – 2018 – to make a difference in your financial outcome by thinking strategically about your charitable giving in 2018.
If you live in a state with high income and property taxes and you have a mortgage, you could find that you can still itemize and can make use of your charitable deductions. Even if you don’t itemize, here are some strategies to make gifts to the Southwest Florida Women’s Foundation and still receive tax benefits:
- You can make larger gifts to charity. Your total deductions may put you close to the threshold where itemizing your deductions offers greater tax benefits than taking the standard deduction. In this case, you might consider making a larger charitable gift to the Southwest Florida Women’s Foundation so that you can enjoy the additional tax savings that itemizing would offer.
- Use a Donor Advised Fund to deduct now and transfer later. One option is to make a larger gift to your Donor Advised Fund in order to reach your threshold to itemize deductions, and then distribute to your favorite charities at the time that is right for you. If you do not already have a Donor Advised Fund, please consider this option from the Southwest Florida Women’s Foundation.
- Make gifts of appreciated property such as publicly-traded securities to the Southwest Florida Women’s Foundation. The new law will still allow you to make gifts of appreciated assets held for at least one year without triggering capital gain tax. If you itemize your deductions, you will get the double tax benefit of an income tax charitable deduction based on the full value of your appreciated assets in addition to capital gains tax avoidance.
- Make gifts to the Southwest Florida Women’s Foundation using the charitable IRA rollover. If you are over 70½, you can make a direct transfer from your traditional IRA or Roth IRA to charity of up to $100,000. You will avoid all income tax on your withdrawal, even if you don’t itemize after the new law.
- Make a gift to the Southwest Florida Women’s Foundation from all or a portion of what’s left in your retirement plan. Assets in your IRA, 401(k), or other qualified retirement plans may be subject to income tax when distributed to heirs. Making a charity a beneficiary of a portion or the entirety of your retirement plan will avoid the income tax that might otherwise be due from your heirs. This is an extremely tax efficient way for you to make gifts to charity that costs your heirs less than giving other kinds of assets.
- Include a gift for the Southwest Florida Women’s Foundation from your estate. The new tax law retains current law and does not impose limits on estate tax charitable deductions. If you have adequate assets and may be subject to estate tax, you might consider a charitable gift from your will, trust, or other estate planning documents. Such a gift will reduce your estate tax burden.
You should always contact your accountant or financial planner to understand how the new tax law will affect your individual tax situation. In addition, the members of our Planned Giving Council want to ensure that you make the best decisions to elevate the status of women and their communities. Please feel free to call on any of our Council members to discuss your specific interests, questions or goals related to making a planned gift to the Southwest Florida Women’s Foundation or contact Brenda Tate at (239) 908-0301 or email@example.com