As a financial advisor we work with individuals and families every day, helping them use their wealth to achieve personal goals while also making a meaningful impact in the areas they care about. While everyone has their own unique way of giving, there are some great strategies you can explore to help you give more and save on taxes at the same time.

Strategy #1 – Own Appreciated Stock? Consider Donating Stock Instead of Cash!

If you sell the stock and donate the proceeds, you would be required to pay taxes on the gains—whether they are short- or long-term. For long-term gains, you could face up to 20% in federal taxes, while short-term gains are taxed at your regular income rate. However, by donating the stock directly, you could potentially save thousands by avoiding these unnecessary taxes.

Strategy #2 – Consider Bunching Your Giving with a Larger One-Time Donation

Bunching your donations can be a smart strategy for those contributing $10,000 to $20,000 or more annually. In many cases, this level of giving doesn’t exceed the standard deduction, meaning donors may no longer receive the same tax benefits from their charitable contributions. Bunching involves combining or “lumping” two or more years’ worth of charitable donations into a single tax year, allowing you to surpass the standard deduction and maximize tax savings. *Please keep in mind that the Tax Cuts and Jobs Act is scheduled to expire at the end of 2025. As a result, depending on what changes are made, the most effective tax strategies for charitable giving could shift.

Strategy #3 – Over 70 ½ & Have a Retirement Account

If you or a parent or grandparent are over 70 ½ and able to contribute to City of Lakes Waldorf School, consider utilizing a Qualified Charitable Distribution (QCD). A QCD is a direct transfer of funds from your IRA to a qualified charity, as outlined in the Internal Revenue Code. The advantage is that a QCD does not count as taxable income, unlike withdrawing the funds and then donating them, which would make the full amount subject to taxes. Even if a charitable deduction is available, a QCD is usually the more tax-efficient option. The tax benefits can be significant. While Required Minimum Distributions (RMDs) aren’t mandatory until age 73, you can begin making QCDs starting at age 70 ½.

As always, please consult with your accountant or financial advisor to discuss your personal situation in more detail. If anyone is not currently working with an advisor, and I can be of assistance, please don’t hesitate to reach out to me at kmsinkin@meathwealthadvisors.com

With gratitude,

Kerry Meath-Sinkin CFP® AIF® Wealth Advisor

This material is distributed for informational purposes only. Investment Advisory services offered through Journey Strategic Wealth, an investment adviser registered with the U.S. Securities and Exchange Commission (“SEC”). The views expressed are for informational purposes only and do not take into account any individual’s personal, financial, or tax considerations. Opinions expressed are subject to change without notice and are not intended as investment advice. Past performance is no guarantee of future results. Please see Journey Strategic Wealth’s Form ADV Part 2A and Form CRS for additional information.