Tax benefits of charitable giving in 2018


Kelly Murray, CWPV Foundation Treasurer

How can you benefit from giving to the CWPV Foundation in 2018 under the new tax law? The deduction limitation on charitable donations is basically unchanged, but the new higher standard deduction, coupled with the new limitation on state tax deductions, may eliminate the need to itemize and essentially eliminate the tax benefit from these deductions.

One way to avoid this outcome would be to double your deductions in alternate years, taking the standard deduction in one year and itemizing in another. Of course, this depends on your individual tax situation. Estate and tax attorneys sometimes recommend a donor advised fund (DAF) which allows you the deduction in the year you fund the DAF, then the DAF makes grant requests to your desired charities over one or more years.

By donating appreciated stocks and other liquid assets directly to the Foundation, you avoid the tax on any capital gains.

And, finally, for those of you with annual required minimum distributions (RMDs) from IRA accounts, using qualified charitable distributions (QCDs) allows you to transfer up to $100,000 per year directly to the CWPV Foundation. Because the amount donated is not included in the taxable IRA distribution, both your gross and taxable incomes are reduced, resulting in an even better financial benefit than itemizing deductions. The QCD is not a new tax planning vehicle and, in fact, the Foundation has received one such donation already in 2018.

The CWPV Foundation is not qualified to give tax advice. Please consult your tax advisor about your circumstances.

Fund-Raising Success: In March, the CWPV Foundation partnered with the IronOaks Tennis Club to match up to $5,000 of Raffle and Auction donations from their Community-Wide Charity Dinner Dance to benefit Neighbors Who care. We are thrilled to announce that the proceeds from the Raffles and Silent Auctions totaled $5,600! By adding the CWPV Foundation’s $5,000 contribution to these funds, as well as an individual $100 donation, Neighbors Who Care will be receiving $10,700 from this endeavor! Amazing what can be accomplished when we all work together!

Just a little bragging… The 2018 Crystal Awards ceremony was held on March 11. This award acknowledges the generosity and dedication of people in our community who volunteer so much of their time, talent and energy to benefit the residents of our Sun Lakes communities. Seven wonderful people received awards this year, including two of our own Cottonwood Palo Verde Foundation board members, Elaine Kraemer and Robert (Bob) Rouleau! Congratulations and many thanks to you and your fellow Crystal Awards recipients!