Four gift strategies for 2015

How to make the most of charitable gifts this year

Four gift strategies for 2015It feels good to give gifts, and to receive them. When you make contributions to qualified charities, you may achieve this double benefit by receiving a tax deduction. The key, however, is to ensure your money goes where you want it to.

Presently, there is approximately $45 billion in donor advised funds (DAF) in the U.S., which represents a 50 percent increase in the past five years.1 It’s interesting that despite lower tax incentives, charitable giving is as popular as ever. To help you make maximum use of your charitable dollars this year, consider the following four strategies you can deploy with a donor advised fund.

1 Create a memoriam. Create a legacy in honor of a loved one who has passed away. You can establish a new DAF or issue grants from an established DAF in that person’s memory. Consider selecting a charitable recipient that reflects the passions of the person you wish to honor, or one that conducts medical research in support of the illness that took his

2 Update succession plans. One of the advantages of a DAF is its flexibility. While you may have set it up to donate to a specific cause, you can change recipients at any time in support of newfound passions. Each year, re-evaluate the beneficiary(s) that will receive distributions upon your death to ensure they are aligned with your current goals. Also consider establishing a payment schedule rather than a lump sum distribution in order to create a longer lasting legacy. Many charities operate more efficiently with smaller donations over time to support ongoing programs, so consider updating your succession plan to make periodic distributions of either a dollar amount or percentage of the balance over a time period or until the account is depleted.

3 Give year-round. Most charities do not operate like seasonal retailers; they need revenues year round. And yet 39 percent of DAF grants are issued in November, December and January.2 Consider the needs of the charitable organizations you support, and set up a year-round or seasonal distribution schedule that best meets their needs.

4 Engage the family. The best way to truly make a difference is through longevity. You can benefit both the charitable organizations you support and develop philanthropic values within your family by setting up a DAF for your children – either collectively or one for each child. Give them the opportunity to manage and support their own charitable causes so they can effectively manage yours should you wish to name them as successor advisor on your account. n


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