By Lesley Roberts, Philanthropic Advisor
As an estate planning, tax, or wealth advisor, you play a key role in helping your clients make the most of their charitable giving, maximizing both impact and tax benefits. But according to a 2023 survey, just 19.2% of advisors bring up charitable giving regularly with clients, and 44.2% do so only occasionally.
That’s where the Community Foundation can help.
We’re here to serve as your charitable sounding board. When a client expresses interest in giving, or when you’re exploring strategies together, just loop us in. We’ll help you navigate the options, crunch the numbers, and tailor a plan that fits your client’s goals.
Of course, you still have to start the conversation. One easy way is by talking about the benefits of giving appreciated assets, like stock or real estate, to a fund at the Community Foundation. To illustrate, consider this hypothetical example:
Meet Jane.
She earns more than $500,000 a year and wants to donate $10,000 to the Community Foundation’s local Giving Tree Endowment. Jane holds Apple stock purchased more than 20 years ago, now worth far more than she paid for it. She also has plenty of cash on hand. Jane is weighing two options:
- Write a check for $10,000
- Transfer $10,000 worth of Apple stock
As her advisor, you already know the smarter tax move is to donate the stock, but here’s how you might explain it with real numbers:
- Jane’s income places her in the 37% federal marginal tax bracket and a 23.8% long-term capital gains tax rate (20% + 3.8% Net Investment Income Tax).
- She itemizes deductions and has a cost basis of $2,000 in the Apple shares she’s considering donating.
Option 1: Give Cash
- Charitable deduction: $10,000
- Federal tax savings: $3,700
- Net cost of gift: $6,300
Option 2: Give Stock
- Avoids $8,000 in capital gains
- Capital gains tax avoided: $1,904
- Federal tax savings: $3,700
- Net cost of gift: $4,396
The takeaway?
Either way, Jane gives $10,000 to charity. But writing a check costs her $6,300. Donating stock? Just $4,396. That’s nearly $2,000 in additional tax benefit, and a clear win for both Jane and the causes she cares about.
Donating appreciated assets is just one of many charitable strategies your clients can use. These conversations often lead to deeper planning around lifetime giving, legacy goals, engaging the next generation, and more.
Let us know how we can help. We’re always happy to share strategies and examples to help your clients give wisely, and with greater impact.