Tax-smart giving in 2018

Since the 2018 tax reform bill passed, you may have wondered how it would change the impact of your charitable giving. The good news is, there are still many ways you can give back and receive potential financial benefits.

1. Donate tax-free through your IRA

Retirees age 70 1/2 and older can donate up to $100,000 from their IRA each year, completely tax-free. Here’s an example of how donating a required minimum distribution of $10,000 through an IRA rather than writing a check directly to a charity could result in significant tax savings:

ira tax example

 

 

 

 

By donating directly through an IRA, the total taxable income decreased, resulting in a lower tax bill. Click here to learn more.

2. Donate appreciated assets

Gifts such as stocks or bonds may offer substantial tax advantages. If you were to sell the appreciated stock, you’d have to pay a capital gains tax. However, when you donate appreciated stocks to a charity like Alzheimer’s San Diego, you’re able to get a tax deduction for the full fair-market value.

3.  Donate retirement plan assets

This is another easy way to make a difference, while being tax-savvy. Simply name a charity as the beneficiary of retirement plan such as an IRA, 401(k) or 403(b). Typically, all this requires is filling out and submitting a form to the organization your plan is through. When this is set up properly as part of an estate plan, it can reduce the amount of taxes on your heirs and your estate.

If you would like to learn more about these or other ways to give to Alzheimer’s San Diego, please contact Michelle Van Hoff at 858.966.3300 or mvanhoff@alzsd.org.