As we near the end of the year, many are evaluating their charitable giving desires. While such a great thing to do, there can be a few pitfalls.
Charitable Giving Pitfalls
Watch the promissory note:
You may want to give to your specific charity over a period of years and may even have spoken to your charity concerning this.
If you sign something that can be construed as a promissory note, you may have unintended consequences. These can range from loss of the charitable deduction, to an unintended legal binding note to your charity.
The recent tragic death of Aubrey McClendon to his alma mater is a great example.
In this case there was a good result:
Maximum Annual Gift Deduction
While most people do not give just for the deduction, appropriate planning may help maximize your tax situation.
This from the IRS:
…..In general, contributions to charitable organizations may be deducted up to 50 percent of adjusted gross income computed without regard to net operating loss carrybacks. Contributions to certain private foundations, veterans organizations, fraternal societies, and cemetery organizations are limited to 30 percent adjusted gross income ….
Also be sure to remember that your contribution may last for some time. Thinking of the charity you choose as long lasting might be helpful as well.
John A. Kvale CFA, CFP
Founder of J.K. Financial, Inc.
A Dallas Texas based fee only
Financial Planning Total Wealth