Encouraging Social Responsibility

If you plan to give more than a few thousand dollars to charity this year, consider whether giving stock instead of cash might be worthwhile. Here’s why… When you give cash to charity, you get to deduct the amount you donate from your taxable income which is a solid tax benefit. But when you give highly appreciated stock instead of cash, you not only get to deduct the value of the stock from your taxable income, you also get to skip paying the long term cap gains tax on those shares. For our clients in CA and NY that’s about 35% in tax savings. This can be a great way to both increase the tax benefit of charitable donations AND unload shares of stock without paying capital gains taxes. Win win! Think about this strategy for old RSUs you’ve held onto over the years, or those Apple, Google, Amazon, Meta, or Nvidia shares you bought that are now worth waaaay more than when you bought them. Assumptions: - You want to donate to charity - You itemize deductions - You’ve held your stock for more than a year - You can give shares of stock either directly to the charity you’d like to support or through a donor advised fund

🕊️I regularly catch this tax-savings opportunity clients miss. Ever hear of donating highly appreciated investments into a Donor-Advised Fund (DAF)?! If you're already giving donations to charities each year, why not save additional capital gains taxes on your donations? DAFs provide a more tax-savvy way to give. Lemme break it all down... 1. Open a Donor-Advised Fund (DAF) Account Select a provider like Schwab Charitable, Fidelity Charitable, Vanguard Charitable, or a community foundation. Fund Your Account: You’ll receive account details for funding. No minimum contributions are required with some providers, but check for their specific policies. 2. Contribute Highly Appreciated Stock Obtain Transfer Instructions: The DAF provider will give you specific transfer instructions for in-kind securities (stock, mutual funds, etfs). Complete the appropriate paperwork to transfer the investments over. Confirm the Gift Value: The DAF provider will value your donation based on the average of the high and low prices of the stock on the day the transfer is completed. Receive Acknowledgment: Your DAF provider will send you a confirmation of the donation for tax purposes. 3. Allocate Funds to Charities Log In to Your DAF Account: Access your account online or contact the DAF provider. Research Charities: Ensure the organizations you wish to support are IRS-qualified 501(c)(3) nonprofits. Recommend a Grant: Specify the charity, the amount, and the timing of the grant. Many DAF providers allow you to include special instructions or dedicate the grant. Track the Impact: DAF providers will handle the distribution and often provide updates when the charity receives the grant. 4. Keep Records for Tax Filing Save the acknowledgment of your stock contribution from the DAF provider for your taxes. You’ll only need this one receipt, as donations to charities from the DAF don’t require separate deductions (you claimed the deduction when funding the DAF). This process not only simplifies charitable giving but also helps maximize the tax benefits, especially when dealing with appreciated assets and reducing capital gains taxation on low-basis stock! Here’s why this strategy is a win-win: ✨ Maximize Your Impact: You can avoid paying capital gains taxes on appreciated assets (stocks, mutual funds or ETFs that have grown), which means more of your money goes directly to the charities you love. ✨ Get an Immediate Tax Deduction: You’ll receive a deduction for the full fair market value of the stock in the year you donate. ✨ Distribute Thoughtfully Over Time: With a DAF, you can take your time to decide which organizations to support and when. Giving Tuesday, yesterday, was a beautiful reminder of the power of generosity, and thoughtful planning can amplify that power. I'd love to hear about causes you care about (I'll list one of mine in the comments) 🌍✨

I recently met with a client who is required to begin taking RMDs this year. Like many individuals who have planned well, there was no real need for the additional income. What stood out instead was a strong desire to give meaningfully to charity. Their initial plan was straightforward: 1. Withdraw the required ~$45,000 from their IRA. Pay the taxes, then donate the remaining amount. 2. Fulfill the RMD requirement. Check the compliance box and move on. 3. Support causes they care about. Continue a long-standing habit of generosity. The intention was right. The strategy needed refinement. The adjustment? We redirected the distribution directly from the IRA to the charity using a Qualified Charitable Distribution (QCD). The result: 1. The full $45,000 satisfied the RMD. No requirement was missed. 2. The charity received the full amount. No dollars lost to taxes along the way. 3. The $45,000 never showed up as taxable income. Which also help reduce downstream impacts like Medicare premium surcharges and Social Security taxation. The interesting part? The outcome aligned exactly with what the client wanted to do all along. Give generously, just in a more efficient way. For many individuals, it’s not just about reducing taxes. It’s about managing adjusted gross income and the ripple effects that follow across a broader financial plan. I love financial planning because it often comes down to small adjustments with outsized impact. The decision wasn’t about changing behavior. It was about improving execution. Wealth planning works the same way. The options are often already there. The value comes from knowing how to connect them. This is why a thoughtful second set of eyes can make a meaningful difference.

Give cash to a charity across the border and you may save nothing. Here's the part wealthy Canada-US families miss. Both countries reward charitable giving, but, by default, only when you give to their own charities. A Canadian writing a cheque to a US cause, or an American giving to one back home, often gets no tax benefit at all on the return they were counting on. There's a treaty bridge (Article XXI of the Canada-US tax treaty), but it carries a catch most donors never hear: the gift generally only counts against income sourced in the charity's country. Get the direction backwards and you've been generous and saved nothing. And the single biggest lever almost everyone overlooks: don't donate cash — donate the stock. Gift appreciated securities in-kind: In Canada, the capital gain is taxed at a 0% inclusion rate. It disappears. In the US, you deduct full fair market value and skip the capital gains tax entirely. The math: $100,000 of stock bought years ago for $60,000. Sell first, and roughly $10,700 in capital gains tax comes off the top before the gift. Give the shares in-kind, and that $10,700 simply vanishes, identical gift to the charity, materially more kept. At $5M+, with large, embedded gains, that's the difference that quietly funds the next gift. Full guide; the treaty rules, the appreciated-securities move, and donor-advised funds vs. private foundations — in the comments. #49thParallelWealthManagement #CrossBorderPlanning #CanadaUS #Philanthropy #WealthManagement #EstatePlanning

Charitable giving is a great tax savings strategy implemented by many philanthropists with big pockets. Some of the best methods: 1. Donate appreciated assets directly to charities. If you donate stocks, bonds, real estate, or other long-term appreciated assets (held over a year), you avoid owing capital gains taxes on appreciation and can deduct the full fair market value as a charitable deduction (generally up to 30% of your adjusted gross income). 2. Use donor-advised funds (DAFs). Contribute cash or appreciated assets to a DAF and take an immediate deduction, while retaining flexibility to advise on distributions to charities in future years. The assets can grow tax-free within the fund, and DAFs make “bunching” or multi-year donation strategies easier. 3. Bunch or aggregate multiple years of giving. Concentrate several years’ worth of donations into a single tax year to exceed the standard deduction threshold, allowing you to itemize and maximize deductions in higher-income years, then claim the standard deduction in off years. 4. Make qualified charitable distributions (QCDs) from IRAs (age 70½+). QCDs go directly from your IRA to a charity, counting towards required minimum distributions but not increasing taxable income. These aren't deductions - they lower your adjusted gross income and potentially reduce the taxes paid on Social Security and Medicare premiums. 5. Charitable estate planning. Designate charities as beneficiaries in your will, retirement plans, or trusts, effectively removing those assets from your taxable estate and possibly reducing or eliminating estate taxes. 6. Charitable trusts. For complex or large giving plans, vehicles such as charitable remainder trusts and charitable lead trusts can provide income, generate immediate tax deductions, and ultimately benefit charitable organizations.

Did you know that #CSR is not just a good business strategy tool but also a powerful tax planning tool when structured properly? Every year, many SMEs in Ghana spend money on CSRs either in supporting schools, communities, sports, scholarships, and other social causes. These are noble efforts. Unfortunately, most SMEs end up losing money on these CSR activities for tax purposes. When the Ghana Revenue Authority - official reviews the accounts, the amounts spent are often disqualified and added back to profit which increases your tax liability. You're asking but why? This is because under the Income Tax 2015, Act 896 (amended), an expense is only allowable if it is wholly, exclusively, and necessarily incurred in the production of income. Most CSR donations, as generous as they are, do not meet this test. As a result, they fail as allowable business expenses. And this where you need to pay attention as a business owner/CEO, etc. The expense on your CSR will be allowed as an allowable expense if the particular CSR activity is considered as worthwhile. Under Section 100 of the Income Tax Act, 2015 (Act 896), a business is allowed to deduct contributions or donations made if it's to a “worthwhile cause" A worthwhile cause may include donations made to a charitable organisation that meets the requirements of Section 97 of the Act, a scheme of scholarship for an academic, technical, professional, or other course of study, development of a rural or urban area, sports development or sports promotion, and any other worthwhile cause approved by the Commissioner-General. If the GRA is not aware of the donation, it will disallow it. Hence, you must claim it formally before you can deduct as an allowable expense. To claim the deduction, you must complete a “Claim Form for Deduction for Contribution/Donation to a Worthwhile Cause” and submit it to the Commissioner-General through the taxpayer’s Tax Office. This step is mandatory. If the form is not submitted, the deduction will not be allowed. In addition, the application must be supported by written acknowledgement from the beneficiaries of the worthwhile cause. These beneficiaries must be verifiable and must have valid Taxpayer Identification Numbers (TINs). Donations made to beneficiaries without TINs or without proper acknowledgement are likely to be rejected. Finally, even where all the above conditions are met, the law gives the Commissioner-General the authority to review the amount being claimed. In approving the deduction, the Commissioner-General will consider Section 34 of the Act, the General Anti-Avoidance Rule. This means GRA will assess whether the donation is reasonable and not structured primarily to avoid tax. As you plan your CSR activities in 2026, don’t stop giving back. Just make sure you give back the right way. #CSR #sustainability #TaxPlanning #SMEs

If you regularly give to charity, you should consider using a bunching strategy in 2024-2025. Consider this example where a family plans to give $16k to charity in 2024 and 2025. If they give $16k both years and have other itemized deductions of $14k, their annual itemized deduction would be $30k and their total itemized deduction for the two-year period would be $60k. Alternatively, if they give two years’ worth of charity in 2024 and then take the assumed standard deduction of $30k in 2025, their total deduction over the two-year period would be $76k. This would lead to an additional deduction of $16k over the two-year period. If those dollars would have otherwise been taxed at 24%, this represents a total federal tax savings of $3,840! Any state income tax savings would be in addition to this. Enjoy this bunching strategy while it lasts. As it currently stands, the standard deduction is due to decrease starting in 2026 and revert back to what it was before the Tax Cuts and Jobs Act. At that point, there probably won’t be as much opportunity for this kind of standard deduction arbitrage. If this strategy is appealing but you still want to give to your charity at a consistent rate throughout 2025, a Donor Advised Fund (DAF) can be useful. You would gift to the DAF during 2024 and receive the tax benefit at the time of making this contribution. You would then set up recurring transfers from your DAF to your charity of choice during 2025. --------------- This post is for general education and should not be taken as advice. Please consult with your accountant before implementing any tax strategies.

Asset-Based Giving: Your Year-End Secret Weapon 📬 Most nonprofits spend October perfecting their appeal letter while ignoring the giving methods that could double some of their largest gifts. Your donors have appreciated stock in brokerage accounts, DAF balances ready to deploy, and IRAs from which they're required to withdraw. But your website says "Donate Now" with a credit card form and nothing else. The methods you're probably not promoting: 💰 Donor-Advised Funds: $54.77 billion flowed through DAFs to nonprofits in 2023. Your $500 annual donor might have one, so make sure you have a DAF widget (see dafwidget.com) on your organization's website. 📊 Appreciated Stock: Less than 6% of wealthy donors give securities, yet they avoid capital gains tax up to 23.8%. Platforms like donatestock.com handle the details, especially if your organization doesn't have a brokerage account. 💵 IRA Qualified Charitable Distributions: Donors 70½+ can give up to $108,000 directly from retirement accounts in 2025, tax-free. Many longtime supporters qualify but don't know you accept these. 🪙 Cryptocurrency: Average crypto donation was $6,295 in 2022—31 times larger than typical online gifts. 56% of top U.S. charities now accept it. 💼 Matching Gifts: Only 1.31% of donations get matched despite 10% being eligible. Add matching gift info to every thank-you message. 🏠 Real Estate & Planned Gifts: Bequests reached $45.84 billion in 2024. Even small donors leave legacy gifts. What prevents donors from activating these giving options? 🚫 Information buried three clicks deep in a PDF 🚫 "Contact us to learn more" instead of clear instructions 🚫 Treating these as separate campaigns What actually works: ✅ Dedicated landing page with simple instructions for each method  ✅ Tax benefits explained in donor language, not accountant-speak ✅ Including all options in year-end appeals: "Give via credit card, check, stock, DAF, or IRA" ✅ One sentence in cultivation meetings about stock and DAF gifts The timing reality: ⏰ Donors meet with financial advisors in October-November for year-end planning. If asset-based giving isn't on your website when they look, you're not part of that conversation. Small shops don't need separate campaigns for each method. You need website pages with instructions that make sense, and appeal letters that mention these options. Monthly giving remains crucial, accounting for 31% of online revenue in 2024. But asset-based gifts unlock the transformational donations that change your trajectory. Your October checklist: Audit your website. Can donors easily find instructions for stock, DAF, and IRA gifts? Fix that this week. #Fundraising #YearEndAppeal #Nonprofits #Development #DonorEngagement #NonprofitStrategy #DAF #PlannedGiving

How One Smart Giving Strategy Unlocked Nearly $200K in Tax Savings A client earning $1.5M in 2023 was looking for ways to improve his tax efficiency. As we reviewed his tax return, something stood out: ✔️ He donated $20,000 annually to his church. ✔️ His SALT deduction was capped at $10,000. ✔️ His total itemized deductions: $30,000. For married couples filing jointly (MFJ) over 65, the standard deduction in 2023 was $30,700—meaning he wasn’t receiving any additional tax benefit for his charitable giving. Key Takeaways for Future Tax Planning ✅ The standard deduction is inflation-adjusted, meaning it will likely increase over time. ✅ The $10,000 state and local tax cap is fixed, so its benefit diminishes as expenses rise. ✅ His annual giving of $20,000 wasn’t enough to consistently exceed the standard deduction. He planned to continue giving, so we explored a more tax-efficient way to structure his donations. The Strategy 🔹 Instead of donating cash annually, he contributed 20 years’ worth of gifts in 2023—totaling $400,000. 🔹 He donated highly appreciated securities instead of cash, creating a double tax benefit: • A $400,000 charitable deduction in 2023 (subject to AGI limits). • Avoiding capital gains tax on securities with a $200,000 cost basis. Since he was in the 37% income tax bracket, plus the 20% capital gains bracket and subject to net investment income tax, this move resulted in nearly $200,000 in potential tax savings. Concerns & Solution He hesitated at the idea of making such a large contribution all at once. That’s where a Donor-Advised Fund (DAF) came in. 💡 With a DAF, he could take the full deduction this year while continuing to give $20,000 annually—just as he always had. Results ✅ Increased tax efficiency ✅ Eliminated capital gains tax on donated securities ✅ Maintained his annual giving schedule for the next 20 years Are Your Clients Aware of Strategies Like This? These conversations can make a huge difference in long-term financial planning. 📌 Clients should consult their tax professional before implementing any charitable giving strategies. #FinancialAdvisors #TaxEfficiency #CharitableGiving #DonorAdvisedFunds #HighIncomePlanning #ValueAdd #ClientEducation

Are you charitably inclined and sitting on a big stock gain in a taxable account? Read this before your next donation. Most people give to charity in a surprisingly tax-inefficient way. They donate a few thousand dollars in cash each year. Not enough to itemize their deductions, which means there’s no tax benefit. Great for the charity, but a missed opportunity for the donor. Here’s a smarter approach I often recommend: ✅ Frontload 5–10 years of donations using appreciated stock ✅ Contribute to a Donor Advised Fund (DAF) ✅ Deduct the fair market value* ✅ Avoid capital gains tax on the position A real example: A client of mine bought a high flying tech stock back in the early 2010s. Nearly the entire position is gain. Before we started working together, she was donating ~$5k/year in cash and getting no tax benefit. This year, she will frontload $50k of stock into a DAF. Which means... ✅ She gets to deduct the full market value on her 2025 tax return ✅ She avoids capital gains tax on a highly appreciated position ✅ She now has 10 years of charitable giving already set aside If you’re committed to giving and have appreciated assets, this approach can make your generosity go further. *The amount you can deduct in a given year depends on your income. For appreciated securities, the limit is generally 30% of AGI. Anything above that can be carried forward for up to 5 years. Disclaimer: This strategy has nuance and moving parts. This post is for educational purposes only. It’s not tax advice. Talk to your financial planner and CPA before taking action.