As the year unfolds, consider whether updates to your estate and tax plans make sense. Now is an excellent time to lean on the team at the Community Foundation. Together with your attorney, CPA, and financial advisor, we can help you explore strategies that fit your unique circumstance. Here are three charitable planning strategies we’d love to discuss with you and your advisors as you prepare for the future:
Leveraging IRAs for Charitable Giving
IRAs remain powerful tools for philanthropy. If you’re over age 70 ½, consider arranging a Qualified Charitable Distribution (QCD) of up to $105,000 (increasing to $108,000 in 2025) to a designated, field-of-interest, or unrestricted fund at the Community Foundation. Additionally, naming your Community Foundation fund as the beneficiary of your IRA or other qualified plan can offer significant tax advantages, such as avoiding estate taxes and the income tax your heirs would incur on inherited IRA funds.
Bunching Charitable Gifts for Maximum Impact
With the standard deduction still high, many donors are considering “bunching” their charitable contributions. By making a significant gift to a fund at the Community Foundation this year, you may be able to itemize your deductions while supporting your favorite causes for years to come. Giving appreciated stock to your donor-advised fund can help you avoid capital gains tax and create a tax-smart giving strategy that benefits both you and the charities you love.
Is a Charitable Lead Trust Right for You?
With interest rates remaining low, now may be the perfect opportunity to consider a charitable lead trust. Our team can help you and your advisors evaluate this option. A charitable lead trust allows you to direct an income stream to your fund at the Community Foundation while transferring future asset appreciation to your heirs with minimized tax impact. It’s also a great way to leverage the current high estate tax exemption, which may change after 2025.
Let’s Start the Conversation
We encourage you to reach out to our team! The Community Foundation is here to help you navigate the complexities of charitable giving while supporting the causes that matter most to you. It’s our privilege to be your trusted partner in philanthropy.