Year-end giving and associated tax strategies focused on charitable giving and private foundations

Foundation Source has recently issued a bulletin which offers practical advice on how to avoid common year-end funding issues entitled 7 Pitfalls to Avoid at Year-End.

Here is a list of the pitfalls detailed in this article:

• Donating highly appreciated property may give rise to only a fraction of the expected tax benefits.
• Donating indebted property may require the donor to pay a self-dealing tax.
• Donating privately held stock may be fraught with unexpected complications.
• Donating stock to a foundation through a broker may not give rise to tax benefits in the expected tax year and may not be valued as expected.
• Donating property to a foundation may result in unexpected taxation of the donor if that property is then sold by the foundation.
• Failing to consider strategies that could cut a foundation’s tax liability in half during a year when highly appreciated stock is sold.
• Failing to consider a strategy to eliminate a foundation’s potential tax liability in appreciated property.

Special thanks to Michael Hogan (Sr. Managing Director, Foundation Source) for making this bulletin available for my readers.