Do you have a donor advised charitable fund? Should you?
Stuart Zimmerman
First 2 highly successful financial consulting careers. Then helped Washington University develop a WAM masters degree.
Bunching contributions is a popular strategy. What do you want your total charitable deduction?to be for the year??And bunching can work perfectly if you have a donor advised fund. You may have big income one year and you want a big deduction.
?You can take the charitable deduction in the year you give the money to your donor-advised fund! Your community foundation has a donor advised fund.?So does your brokerage firm Fidelity or Schwab.?Plenty of other choices too.?Make it convenient for you.?Ask your investment advisor.
And get just one receipt for your contribution for the year.?Give highly appreciated stock rather than write a check.?Oh, and no capital gains tax to pay on the appreciation!?Make sure you have owned the stock more than a year though. The donor advised fund may require a minimum initial contribution, perhaps $10,000.
Then you have an unlimited amount of time to make the contributions from your charitable fund.?Your fund can usually make the contribution within a week. And it’s all online!?What a pleasure.?Never write a check again. And the timing doesn't matter. You took the charitable deduction when you donated to your fund.
Pick your favorite, say 20,?charities for starters.?You’ll become a steady giver to the not for profits that you love. Most donor advised funds require a minimum out of the fund to each donee.?My fund's minimum gift is $250. Remember, you can dole out the gifts when you please.?No dates for gifts to the charities are required.
Bottom line.?Take the deduction in the year you need it.?The money goes straight into your charitable donor advised fund.?It’s gone from your estate, and you get the charitable deduction.?And there's no tax on the appreciation! Then the gifts to the charities are given out as you see fit, whenever you see it as appropriate.?I suggest yearly gifts to the charities, but it does not matter.
You control the yearly giving from your fund, but the gift was deducted in the year that you needed the deduction. Yes, you can have your cake and eat it too. Enjoy your giving!