NICK DIETZEN | December 10, 2020
Uncertainty has unfortunately been a main theme for the past year. Facing unprecedented challenges related to the COVID-19 Pandemic has increased worries for many. Our most vulnerable neighbors have only seen an increase in vulnerability and the number of those in need has increased dramatically over the course of the year as the economic toll has weighed heavy in Santa Barbara County.
Despite these challenges, many of you and your fellow neighbors have responded selflessly and generously – for that, we thank you!
As we come to a close in the calendar year, it is not too late to consider some excellent gifting options you may not have considered:
- For 2020 Only: Deduct up to 100% of your income
- Earlier in the year, the CARES Act made possible for donors to deduct up to 100% of your adjusted gross income (AGI) for charitable gifts of cash. These gifts must go to an operating nonprofit (donor advised funds are excluded from this provision.)
- IRA Rollover Gifts for donors age 70½
- For this year only, IRA accounts have no required minimum distribution (RMD) in 2020. However, donors age 70½ or older may continue to use this tax-efficient gifting strategy by making gifts directly from an IRA to a nonprofit up to $100,000. This gift is made with pre-tax dollars. The earned income is never taxed because it goes directly to the nonprofit.
- Starting this year, heirs (except spouses) must withdraw all funds (and pay taxes) within 10 years of inheriting. If you assign any percentage or amount to a nonprofit, they avoid these taxes. Now is a great time to leave your favorite nonprofit in your estate plans by using these accounts first. Contact your IRA plan administrator today. These gifts are easy to request and process by the end of the year.
- Gifts of Appreciated Stock
- Donating appreciated assets like stocks creates two tax benefits:
- 1) The tax deduction is the same size as a gift of cash. (The asset must have been owned for a year or more.)
- 2) Additionally, you do not pay capital gains tax on the increase in value of the stock.
We are grateful for our donors as well as our professional advisors who assist donors in making charitable giving a success in Santa Barbara County. If any of these options are appealing, please contact your professional advisor sooner than later. They will thank you for the lead time in executing these wonderful charitable options.
Warm wishes for you and your loved ones this holiday season!
Major Gifts Officer at the Santa Barbara Foundation
Contact Nick at NDietzen@SBFoundation.org or (805) 880-9352.