With Giving Tuesday behind us, and Colorado Gives Day right around the corner, making thoughtful decisions about year-end giving can feel stressful or overwhelming. Professional advisors are here to help. Indeed, to help you achieve your giving goals, we did a little research to compile the following five tips for last-minute charitable giving from advisors around the country:
1. Know your charities
Only donations to organizations with tax-exempt 501(c)(3) status are deductible on your tax return. You can research charities at online databases that keep track of all tax-exempt organizations, such as the ones maintained by the National Center for Charitable Statistics or GuideStar. As well, the IRS has an online search tool which lists most organizations that are eligible to receive deductible contributions. Note: Religious institutions and government agencies are generally eligible, even if they are not listed in the IRS database.
2. Leverage matching funds and incentives
Matching funds combined with the natural sense of urgency of a giving deadline can be a powerful motivator for donors because it increases the value of their gift. Along the same lines, the Community First Foundation and FirstBank each contributed $500,000 to create a $1 Million Incentive Fund again this year, proportionally increasing the value of every Colorado Gives Day donation.
3. Donor-advised funds
Donor-advised funds can help take the headache out of making individual contributions to charitable organizations. Did you know that you can deduct the full amount of annual contributions, even if you haven’t decided yet which particular charities you want to donate to? You maintain influence on how contributions are distributed down the road, while The Community Foundation does the due diligence on potential grantees.
4. Individual gifts
No matter your budget and ability to give, you can make a difference. Pick a cause that’s closest to your heart – by contributing any amount to help fund education, environment, health and other programs, you’re contributing to positive change.
5. Reduce your 2015 taxes and don’t leave money on the table
Charitable contributions allowed by the IRS in addition to all your other itemized deductions can amount to a greater amount than the set standard deduction, and therefore help reduce your taxes while putting your money to work for a cause(s) you care about most.
The Community Foundation partners with professional advisors to help their clients practice meaningful philanthropy with maximum tax benefit. Many clients find starting a donor-advised fund with The Community Foundation a hassle-free and less expensive alternative to establishing a private foundation, and many find making a gift to The Community Trust a highly leveraged way to make a difference in Boulder County. Learn more about giving options at The Community Foundation.
