What is the number one reason that people make gifts to charity? Quite simply, it is because we are asked. Less simple are decisions about where, when, how much, and what to give. Scores of nonprofit organizations vie for our support, so we winnow the list by focusing on those that speak to our values, goals, and aspirations. (And the occasional heart-tugging photograph that catches us at a vulnerable moment!) When, how much, and what we give are frequently related to life stages.
When we’re younger, we tend to make gifts of cash, as we have not yet attained assets such as stocks and bonds, real estate, and other investments. We give when it strikes us and as we are able, with considerations about tax benefits largely out of mind.
Timing takes on greater relevance as we get older, when we may begin to develop annual budgets for charitable giving and to itemize our deductions. Gift giving may be associated with fiscal (June 30) and calendar (Dec. 31) year ends. We also tend to find that the scope and sizes of our assets are expanding as we age, thus it makes sense to give from those that have increased in value: in addition to receiving a federal income tax deduction, we reduce or eliminate capital gains taxes. We may be more likely to give in response to personal requests from charity representatives and may find that, with planning, we can give more to charity than we ever thought possible.
When we reach retirement age, charitable gift annuities that provide a federal income tax deduction and income for life might be appealing. This is also a time when we take stock of our assets and begin to plan for their eventual distribution. We question how to best provide for ourselves and our loved ones while minimizing taxes and making meaningful impacts at our favored nonprofit organizations. Charitable trusts funded with appreciated assets including stocks, bonds, real estate, and collectibles provide substantial income tax deductions and income during life; reduce capital gains taxes; and leave significant dollars in support of organizational missions. Finally, gifts at life’s end made through wills, life insurance, and retirement assets provide special acknowledgment of the organizations that meant so much to us during life.
It is truly the case that there is a way to give for every person at every stage of her life. Visit Allegheny’s Office of Gift Planning or call us at (814) 332-6519 to identify gift options that suit your needs now and in the future.