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Tips to maximize tax benefits for year-end giving

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Yellow flowers in Arizona Desert
By: Kimberly Kur, JD, CAP®, Chief Development Officer

Partnering with ACF and engaging with your professional advisors at calendar year-end can help bring charitable goals to life while maximizing individual tax advantages for the tax year.

Consider a bunching strategy. You can benefit from a charitable tax deduction by combining multiple years of intended gifts into one year. You'll get the full tax deduction now and grants can be made over time to the charities of your choice.

Use required IRA distributions for giving. If you are 70½ years of age or older, you may direct up to $100,000 of your traditional IRA each year by making Qualified Charitable Distributions to support charitable causes. Beginning at age 73, these QCDs can offset required minimum distributions, thereby lowering your taxable income. Learn more about qualified charitable distributions.

Rebalance investment portfolios by donating highly appreciated securities to your donor advised fund. No capital gains tax will be assessed on the donation and you will be eligible for a full fair market value tax deduction, subject to AGI limitations, all while diversifying your investment portfolio. You can then lean on ACF’s philanthropic resources and community expertise to make grants over time.

Consider non-cash asset gifts. When donating gifts of non-cash assets to a fund at ACF prior to a liquidity event, you can maximize charitable tax benefits and be eligible to receive a full fair market value tax deduction, subject to AGI limitations, with no capital gains tax on the gifted portion. Eligible assets include real estate, closely-held business interests, and more. Learn more about non-cash assets.

Take advantage of Arizona's tax credits for specific charitable contributions. For details and more information on qualified charitable organizations, visit the Arizona Department of Revenue website. Additionally, please inquire with our Cochise, Flagstaff, Gila Valley, and Yuma offices on their tax credit coalitions.

Give the gift of unrestricted funding. Lean on ACF's expertise by donating to the Richard H. Whitney Fund for the Common Good or one of our regional community funds, which benefit community needs both today and in the future.

Disclaimer - This information is for educational purposes only and should not be considered either legal or financial advice. Please see your own professional advisors for information that applies specifically to your circumstances.