Opinion: With year-end tax strategy, don’t forget to think outside the box

Ashley Silva

If you haven’t said it or heard it enough recently, let me say it again: The end of the calendar year is busy! Thanks to the holidays, November and December present us all with additional family, social and financial obligations to meet. With spirits high, it is also what we in philanthropy call the giving season, when many people choose to give back to causes and charities that are dear to us. It’s also the time when most of us are considering our overall financial position, preparing to file tax returns and considering goals for the year to come.

Charitable giving often becomes a part of the cadence of the season. Giving Tuesday is a popular time for nonprofits to seek one-time gifts to their regular end-of-year campaigns. Meanwhile, donors are on the lookout for quick ways to reduce their tax burden while simultaneously supporting the causes and charities they hold dear. This is a symbiotic relationship we all know well and should absolutely be part of any family’s end-of-year planning if they have the means to do so.

But your strategy doesn’t have to end there. With the help of our network of financial advisers and tax attorneys, the Community Foundation of the Ozarks has a number of ways to not only optimize current-year tax strategy but also set yourself up to make even greater impact for your favorite causes in the future. And they may not be ways you would automatically consider when you think giving:

• Stock gifts. The CFO accepts most publicly traded securities, which we can convert to charitable dollars in a donor-advised or similar fund. Transfers of stock are made in-kind so that the donor does not realize any capital gains associated with the gift. Once the CFO receives the stock, it is quickly liquidated and placed in the fund of your choice.

• IRA rollover. For some donors who have reached the age requirement, the required IRA minimum distribution can be an annual challenge. Did you know you can donate this required minimum directly to a nonprofit organization, or a fund at the CFO (though not donor-advised funds), allowing you to avoid claiming it as income? Your personal adviser can give you individualized information on this strategy, but it is a flexible option for those who use it.

• Other unique gifts. While assets like closely held stock, cryptocurrency, personal property and real estate can take more time to transact, these too can be converted to charitable funds or gifts through the expertise of your personal adviser and the CFO. Donors have opened significant funds and made large gifts based on these assets.

Now may be a suitable time to consider some of these options. With a new federal tax bill anticipated in 2025 – a process that could take until this time next year – no one knows quite what policies the new administration will seek to implement. Maximizing your charitable strategy in 2024 may serve you well in the future.

Regardless of the strategy you choose, conversation is the key.

The information above is not intended as legal, accounting or financial-planning advice, which is why we so value our relationship with professional advisers. They know their clients best and are also engaged with our community, and we are always available if they have questions.

We know the needs of our nonprofit partners will continue, as will your need for flexibility in your personal giving. Your community foundation is here to help make these connections, this holiday season and beyond.

Ashley Silva is vice president of donor development and philanthropic services for the Community Foundation of the Ozarks. She can be reached at asilva@cfozarks.org.