We know it’s hard to believe, but it’s already the holiday season!
As we approach #GivingTuesday and the end-of-year bids for your tax-deductible donations, let’s talk about your options to give, not only to make an immediate impact, but to support the future of the organizations you’re passionate about.
From taking additional steps to give regularly now or preparing to give as a legacy, choose any of these easy options to make a huge impact on your favorite cause.
Here’s a bonus: if you act on some of these by December 31, you could qualify for a tax break this year.
- Make automatic recurring gifts each month or pay period. – Giving shouldn’t be impulsive and it doesn’t always have to be spontaneous. Look at your budget and seriously consider what you’re willing and able to give – not just for the next two weeks, but the for the next few months, or even the next few years. Many organizations can accommodate set, automatic donations withdrawn from your account on the schedule you choose.
- Give as a family. – If you have children, consider teaching them to give. Instilling the importance of being receivers and givers can also teach an inevitable lesson about the importance of money. If possible, allow your children to “earn” and give money to causes they are passionate about.
- Leave a charity/non-profit/volunteer organization in your will. – Have you thought about your will? If you have, you’ve probably considered leaving money for family or friends, but what about vulnerable people you don’t know? Leaving a donation in your will is a way to promote a legacy of giving. Or you can arrange for one or more of your relatives to donate a portion of their inheritance to a nonprofit in your memory. They would receive an income tax deduction for the gift, and the kind gesture would likely encourage a culture of planned giving for generations to come.
- Name an organization as a beneficiary in your IRA or retirement plan. – If you are unable to use all the money set aside in your retirement plan, you could leave the remainder to your heirs. Unfortunately, they would be forced to pay income taxes and possibly state and federal estate taxes. You can leave the remainder to your beloved cause, tax-free. Oh, and you could get a tax break in 2016 if you complete this before December 31. Talk to your financial planner.
- Arrange for the remainder of a savings or stock account to go to a nonprofit. – You can opt to transfer the remaining balance of your savings account to your favorite organization after your passing. While you are living, only you would have access to the account, but a stock account future gift, called a TDO (transfer on death account), allows funds to be handed over to the group of your choice. This is easy to arrange; simply tell your bank officer that you want to rename the account: “(your name) in trust for (organization’s name).” Talk to your financial planner before the end of the year and ask if you would qualify for a tax break for 2016.