Issue link: https://info.seic.com/i/1478953
Tax planning ideas • Donate appreciated securities – the tax gain is not recognized. • Front-load charitable contributions in a high-income year. For example, pair a DAF contribution with a Roth conversion, a bonus, or stock option exercise, if you realized capital gains or sold real estate or a business. Roth conversions are considered income and are generally taxable, one way to help offset the Roth conversion income is to offset the conversion with charitable contributions. • Lump and clump strategy for itemized deductions. You can lump multiple years of contributions into one year and clump the contributions into a donor-advised fund, thereby increasing itemized tax deductions in an effort to hurdle the standard deduction. National Day of Giving – November 29, 2022 National Day of Giving encourages giving back. Every year, on the Tuesday after Thanksgiving, people take the time to kick off the holiday season by giving back to their community. Whether it is donating money to a charitable cause or volunteering, Giving Tuesday is a day to benefit the community. Donating to your donor-advised fund can be a great way to participate in the National Day of Giving. What's next? We have seen a lot of appreciation in stocks over the last few years. Many individuals are looking for ways to contribute these appreciated securities so they don't incur capital gains taxes when they're sold. According to National Philanthropic Trust (NPT), in 2021, donors contributed $8.6 billion to their donor-advised funds and granted $6 billion. Individuals who contribute to these irrevocable, tax-deductible funds use the assets to make grants to qualified nonprofits. Contact your financial advisor to discuss how a donor-advised fund may fit into your financial future.