Tax Efficient Giving 2017

Thanks for considering a contribution to the MHS ’65 Scholarship! We believe it’s a worthy cause- benefitting deserving individuals while building a Legacy for our MHS ’65 Class.

We’ve partnered with the Moline Foundation, a Tax-Exempt 501 (c)(3) organization with a 60+ year history of bettering Moline and surrounding communities. 

If you join our Legacy, there are various techniques which can yield larger benefit to the Scholarship program with less after- tax “cost” to the contributor. Following are some of the more common of these techniques. Because each individual’s situation is unique, and because tax law can change, please consult your tax advisor to determine your most tax efficient course of action:

1)    Write a check—it’s a charitable deduction.
2)    Donate appreciated securities held for more than one year- which results in a charitable deduction for the Fair Market Value of the securities, and avoids capital gains on their appreciation—a double tax benefit.
3)    Name us as a beneficiary of your life insurance policy; receive a charitable tax deduction (Your insurance provider or tax advisor can provide more detail.)
4)    Give unneeded retirement assets such as from an IRA, 401 (k), 403 (b), or similar IRS Qualified Plan and avoid potential Estate Tax via an estate charitable deduction.
5)    Include us in your Will; leave a specific amount or a percentage of your estate and receive an estate tax charitable deduction.
6)    For individuals 70½ or older, a Qualified Charitable Distribution counts toward Minimum Required Distributions (from IRAs) and avoids tax on those charitable distributions for many individuals. Some restrictions apply; consult your tax advisor.

Again, thanks for considering our MHS 65 Scholarship Legacy. Please consult your tax advisor for more alternatives and more detail to optimize the tax efficiency of your much appreciated support.

--Courtesy of some of MHS '65 MBAs, CPAs, and JD

 

Qualified Charitable Distributions (QCDs)

For individuals 70 1/2 or older, a QCD counts toward your annual Required Minimum Distributions from IRAs (or other Qualified accounts), and avoids ordinary income tax treatment of those Charitable Distributions. This benefits those who claim the Standard Deduction, i.e. they don’t itemize deductions. It also benefits individuals who itemize, but are limited in such itemization. 

An example: a person who donates $100, claims the Standard Deduction, and is in a 25% marginal tax bracket would have a net, after tax cost of $75 ($100 less $25 tax benefit.)  

 

Let Uncle Sam boost the amount of help you can provide to worthy charities, including MHS 65!