NOW IS A GREAT TIME TO WORK WITH YOUR clients to plan their charitable giving for 2023, and there are several options beyond writing a check. Sometimes, utilizing other assets can have the dual advantages of maximizing tax benefits for your client and their family while allowing them to give more to the organizations they support. This ensures their donations have the greatest impact in the community while also providing your clients with the most tax advantages possible. While cash is easy to donate, it may not be the right option for all situations. Below are some examples of non-cash assets people can donate that will benefit their favorite nonprofits and their tax planning. Charitable IRA Rollover If your client owns an Individual Retirement Account (IRA), a charitable IRA rollover (also known as a qualified charitable distribution, or QCD) is a tax-savvy way to use their retirement assets during their lifetime to make charitable gifts. If a person is 70½ or older, they can donate up to $100,000 per year from an IRA directly to a charitable organization, including a fund at the Omaha Community Foundation. Beginning in 2023, people who are 70½ and older may elect, as part of their QCD limit, a one-time gift up to $50,000, adjusted annually for inflation, to a charitable remainder unitrust (CRUT), a charitable remainder annuity trust (CRAT), or a charitable gift annuity. The donation is excluded from their taxable income and counts toward the required minimum distribution if they are required to take one. The charitable IRA rollover operates separately from the percentage rules that limit the tax benefit of individual charitable giving. So, if your client is inclined to give more than the standard deduction, this rollover is a great option. You may find that the rollover provides greater tax savings than cash donations because your client’s adjusted gross income will be lower. In addition, if your client names a nonprofit as a full or partial beneficiary on their IRA or other retirement accounts, neither the client nor their heirs will pay taxes on that portion of the distribution. Real Estate Donating real estate is another fantastic way to support causes and nonprofit organizations. It is also one of the most financially beneficial types of gifts for donors. PLAN CHARITABLE GIVING Know which type of asset donation will do the most good in the community and provide the biggest tax benefit. BY DONNA KUSH, PRESIDENT & CEO, OMAHA COMMUNITY FOUNDATION FOR THE GREATEST IMPACT 28 Nebraska CPAs
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