This year might be the most advantageous to give to TPF — before tax breaks and other provisions change under the pending Tax Cuts and Jobs Act.
If you are not sure what cause to support, you may want to consider opening a donor advised fund, which lets you get a tax deduction in the year you make the gift and then decide on which charities to support later.
As we enter the holiday season and the end of 2017, Turkish Philanthropy Funds would also like to assist you with your year-end giving and grant making with the best possible service. Please keep these important dates in mind to ensure your year-end gifts qualify for a charitable income tax deduction in the 2017 tax year:
- Checks sent via the U.S. Postal Service to TPF office must be postmarked on or before December 30, 2017.
- Checks sent via carriers such as FedEx, UPS and DHL must be physically receivedat TPF office on or before December 29, 2017.
- Gifts of appreciated stock and wire transfers should be made by December 26, 2017. Early notification of these gifts will help ensure a smooth transfer. Contact Senay Ataselim-Yilmaz at email@example.com or call 646.530.8988 for assistance with stock gifts and wire transfers.
- Online contributions may be made until December 31, 2017
- Credit card gifts made by phone must be made no later than December 28, 2017 to ensure timely posting by the credit card company.
- Real estate gifts must have title transferred on or before Thursday, December 28, 2017.
Year-end grant recommendations
Donor advised fund holders may wish to recommend grants as part of year-end giving or as holiday contributions. In order for nonprofit recipients to receive grants in 2017, recommendations should be made by Friday, December 15 as long as the non-profit is a TPF partner in Turkey or a tax-exempt organization in the United States. Donor advised grant recommendations could be made by using this form via email to firstname.lastname@example.org, or via fax to 646.880.9347. Please note that the timing of donor advised grants has no effect on your 2017 charitable income tax deductions since, for tax purposes, your charitable contribution was deemed completed at the time it was contributed to your donor advised fund.
Qualified Charitable Distributions from IRA
Congress has made the IRA charitable rollover permanent. You can roll over up to $100,000 from an IRA account directly to TPF without recognizing the assets transferred to TPF as income. To qualify:
- You must be 70½ or older at the time of your gift and
- The transfer must go directly from your IRA to TPF.
Direct gifts to TPF from your IRA can:
- Be an easy and convenient way to make a gift from one of your major assets.
- Be excluded from your gross income: a tax-free rollover.
- Count toward your required minimum distribution.
Please note that a distribution to a donor advised fund does not qualify for this special treatment. Please call Senay Ataselim-Yilmaz at 646.530.8978 if you’d like to contribute IRA assets.
Consider Donating Appreciated Stock at the End of the Year
For those invested in the stock market, 2017 was an unprecedented year with significant returns. If your portfolio has prospered, you may want to consider making some of your year-end gifts with appreciated stock.
You can achieve a greater impact by donating long-term appreciated securities. Compared to donating cash, or selling your appreciated securities and contributing the after-tax proceeds, you may be able to automatically increase your gift value and increase your tax deduction.
How does it work?
It’s simple and easy.
Consider what stock has grown in value since you bought it.
Appreciated stock that is contributed to TPF is exempt from capital gains taxes. If you sold the stock and used the proceeds to write a check for your gift, you would potentially be liable for capital gains tax. When you claim a charitable tax deduction for your gift, the full fair market value of the appreciated stock on the transfer date is your gift amount.
An illustration of the value you would realize if you donated your appreciated stock to TPF appears below. (Note: To bypass long-term capital gains, you need to have owned the stock you select for gifting at least 366 days)
Original cost of the stock: $100,000
Potential federal long-term capital gains rate: 23.8%
Current value of the stock: $175,000
|Sell stock and donate proceeds||Donate stock to TPF|
|Long-Term Capital Gains Tax||$17,850||$0|
Additional amount dedicated to the nonprofit organization is $17,850 (the value of the capital gains tax).
The value to you is a higher tax deduction and a greater charitable gift.
What should I do to take advantage of this opportunity?
- Contact your broker. Every brokerage firm has a slightly different requirement. Make sure you check their end-of-year deadlines to make sure your gift transfers before the end of December.
- Notify TPF so we are aware of the pending transfer and identify where the funds should be directed. You will be provided with a stock transfer instructions document to share with your broker.
Note: This information is for educational purposes only and is not intended to be legal or financial advice. Please contact your own professional advisor for individual financial and legal advice.