Many people choose to donate at the end of the year, especially during the holiday season, which promotes generosity. If you would like to increase your philanthropy, there are numerous ways to achieve your goal. From bundling your charity giving to donating appreciated securities, you can contribute to great causes, while spending your hard-earned money wisely.
Wait To Give
Instead of giving every year, think about bundling your charitable giving, which is when individuals donate every two or three years to meet a higher standard deduction requirement. For example, if you donate $10,000 annually but could give $20,000 every two years, you could get itemized deductions during the first year and take the standard deduction during the second year. Another way to bundle is to use a donor-advised fund, which invests the funds for possible growth and then sends the grant money to charities over the span of two to three years. If you use a donor-advised fund to make catalytic impact investments, then you will be a part of the country’s quickest-growing charitable machines, which allows you to reap tax benefits.
Donate Appreciated Stock, Real Estate or Mutual Funds
Even though you may not be looking for a big tax break this year, it is advised to think about your giving in a strategic fashion. Donating appreciated assets, including mutual funds, stock or real estate, whether directly to a nonprofit or through a donor-advised fund can be in your best interest. Donating long-term appreciated assets enables you to give to a nonprofit and receive a full tax deduction on the fair market value of the assets. Since they are donated instead of sold, the donor does not have to pay for taxes of capital gains. This means that the whole value of the donation can be used in support of the charity.
Focus On Your Favorite Organizations
If you maximize your charitable impact by doubling down on the organizations that you care about, then you can help create a greater impact. By being the kind of donor that focuses on a few main nonprofits, you can help drive change with your investment in climate change, girls in STEM, social injustice, religious causes, foster care, cancer or another mission of your choice.