What is a donor-advised fund? Donor-advised funds are charitable gifting programs administered by a public charity and created to manage donations for donors (individuals, families or organizations). Many people find donor-advised funds flexible and easy-to-use – and they offer charitable, financial and tax planning advantages for many donors.
The Tax Cuts and Jobs Act of 2017 is the legislative centerpiece of President Trump’s first year in office. The law increases the standard deduction, likely reducing taxpayers’ motivation to itemize deductions. While experts differ, most expect this change to have a negative effect on charitable giving. Donors who care about the mission and futures of the nonprofits they support should pay attention to what’s a fact, and what’s speculation, about the potential effects of this far-reaching act.
Representative Mark Walker of North Carolina has proposed the Universal Charitable Deduction which would allow non-itemizers to deduct their gifts in addition to taking the standard deduction. The bill caps the deduction at one-third of the standard deduction. The charitable community likes the universal concept, but many are wondering if the cap is needed as it can impact gifts from donors who don’t use the itemized deduction.
Financial advisors often speak with their clients about charitable giving and, currently, many of those clients itemize their deductions. However, if as proposed in the “Big Six” in the Senate’s 9-page plan, the standard deduction would double and the itemized deduction for state and local taxes would not. If tax reform results in changes that affect the standard deduction, here are the reasons why financial advisors should support the Universal Charitable Deduction:
On May 30, 1985, I skipped high school. No, it was not senior skip day, nor did I really desire a break from school. I wanted to travel from Appleton to Oshkosh to see President Reagan speak. He had just introduced his plan on what would eventually become the Tax Reform Act of 1986 and first went to Wisconsin to sell it to the American people. Contrary to my parents wishes, I did hear the speech in person and watched the ensuing process that produced the new tax code. It was something that sparked my interest in learning about taxes and how (and why) they work the way they do.
In law school, my intellectual curiosity about taxes turned towards the charitable deduction and was one of the major factors that drove me to pursue a career in charitable gift planning. I fell in love with the fact that our country effectively allowed citizens to choose where their tax dollars could make a difference. Read more on the blog…
On December 9th, the markets hit their 13th record close since the November elections. Accompanying the records in the market, we have also seen what feels like a record number of opinions of what the change in administrations will mean for taxes. Some of these opinions have focused on the potential tax changes and their effects on the charities and the charitable deduction. Fidelity Charitable offered what I consider a measured and reasonable framework for the possibilities. It is safe to conclude that there is at least a good likelihood that the benefits of giving in 2016 may be more tax wise than in future years. If you believe that to be true, these next few days may be ideal for starting a donor advised fund.
Remember to support the nonprofits you love this holiday season and if we are among them, thank you! Help support our work by donating at http://adviseus.org/support-our-work/
Giving Tuesday was started in 2012 in a partnership by the 92nd Street Y and the United Nations Foundation to create an international day of giving during the busy holiday shopping season. Since 2012, Giving Tuesday (#GivingTuesday) has become a powerful movement supporting giving and creating a culture of philanthropy.
Join Us for Our Free Fall Boot Camp: Donor Advised Fund Essentials for Small and Medium Charities
The Active Transportation Alliance partnered with The Advise Us Fund to offer expanded giving options to donors. This new partnership will go a long way in supporting Active Trans in its future development and planned giving efforts. Read more…
Your wallet, your heart and your head must all be open when donating to a charity. The first two are easy: you either have the passion and the funds or you don’t. However, the latter requires you to ask yourself five important questions to give wisely to a reputable charity. Read more…
As founder of The Advise Us Fund, I recognize the power of giving. Since starting this nonprofit organization, I’ve seen firsthand that philanthropy makes our communities stronger by helping those in need and supporting causes that are closest to our hearts. We are all motivated by these passions, and The Advise Us Fund is how I exhibit what’s closest to my heart: philanthropy. Read more…
Most likely you should start now. Your children or grandchildren, as young as three years old, have started learning to share. Charity is another form of sharing – and sharing with your children or grandchildren is another part of your legacy.
Don’t have time now? Do it later. Something came up and you want to give now? Go ahead. Do you have a foundation or a charitable trust and want additional flexibility? You can have it – and here’s how.
Nonprofit organizations get big results with traditional recurring gift donors. Donor-advised funds are a new, major, and growing segment of charitable giving dollars – but soliciting recurring donations from them is different. Here’s how to do it.
Donors often follow their passion and use donor-advised funds with specific charitable goals and themes in mind.
More donors are taking advantage of scheduling donor-advised fund contributions to charity. Here are three donor benefits to scheduling donor-advised fund gifts.
Donor-advised funds give you a great tool that lets you focus on the joys of charitable giving. Here are five benefits donor-advised funds bring to your charitable experience.