Charitable Gift Tips – It’s Not Too Late (but close!)

Yes, 2022 is quickly drawing to a close, but it’s not too late to help those non-profit organizations you love.

Here are three quick tips for making the most of your charitable gifts for taxes.

  1. If you are age 70 ½ or older, you can take advantage of Qualified Charitable Distributions from your traditional IRA. This allows you to take up to $100,000 per year from your IRA and gift directly to charity.  The gift counts toward your RMD obligation.
  2. Gift appreciates stock, mutual funds, ETFs, art, cars, etc. before cash. By gifting assets that have grown in value, you can skip selling them yourself and paying the capital gains taxes.  The charity sells the gifted asset and they do not pay capital gains taxes.  You write off the entire value of the gift and save on income taxes.
  3. The excellent Tip #2 benefits you most if you are itemizing your deductions. Many people don’t with the new higher standard deduction put in place in 2020.  Some CPAs recommend their clients batch their gifts into two year cycles.  Double your gift every two years and itemize deductions in the years of the large charitable gifts.

Quick reminder, gifts to your chronically under employed nephew or other individuals are NOT deductible on your taxes.

Last, if you are planning to do any gifting of shares or IRA money, get on the stick!  Investment companies need some business days to make these transfers happen and the gifts need to be completed by December 31st to count for 2022.

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Kristi Sullivan

My name is Kristi Sullivan and I have been helping people achieve financial security since 1996. I am a fee-only financial planner and public speaker. I do no investment or insurance sales for commissions. My clients pay me for guidance through their financial questions. I also work with employers to educate their employees about personal finance. I have been helping people make financial decisions for 18 years. I have worked in employee benefits and with individual clients/families. I hold the Certified Financial Planner designation. Sullivan Financial Planning, LLC is a Registered Investment Advisory firm with the State of Colorado. Areas of expertise include prioritizing savings goals, investment allocation, and wealth manager searches.