Support the Causes You Value and Reap Tax Benefits too
The following is a reprint of the JCF's Money Matters column, published in the March 22, 2023 issue of the Jewish Community Voice:
With Tax Day approaching, and as you reflect on how your finances unfolded in 2022, now is an ideal time to scope out your financial plans for the rest of 2023. The Board and staff at the Jewish Community Foundation, Inc. hope you include charitable giving in your annual financial plans. In addition to helping others, you can earn charitable tax benefits, and we are here to help you during your philanthropic journey. We can even work alongside your professional advisor(s) to reach your goals.
As most advisors would attest, an integral part of modern philanthropy is utilizing a donor advised fund (DAF). With a DAF, you gain a convenient, online charitable giving account that serves as your hub for supporting the causes you care about. Notably, across the country, donors have established over 1.2-million DAFs to enhance their philanthropy.
As a service to Jewish community members here in South Jersey, the JCF provides DAFS, and we invite you to consider opening a fund to boost your philanthropy. For a taste of how a DAF may help you, enjoy three fictional (but realistic) DAF donor profiles:
• Laurie & Maury: As grandparents, Laurie and Maury enjoy discussing their tzedakah goals with their children and grandchildren. Each Chanukah, they meet as a family and engage in a meaningful discussion about which charities to support, why they are important organizations for the community, and how much to give each one. Then, they simply enter their grant recommendations into their online DAF portal, and the JCF cuts the checks and keeps records. The couple can even leave their DAF to their kids and grandkids as successors in the future, so they can continue the family’s philanthropic tradition.
• Jenny & Benny: Both newly retired, this couple happily spends ample time volunteering and giving back to the community. In the years leading up to retirement, they steadily built up their DAF, and allowed the invested dollars to grow over time, tax-free. With more time to focus on philanthropy, they can work alongside their favorite charities to determine how they may maximize their support via grant recommendations from their DAF. They can even consult with the JCF for unique giving opportunities that align with their interests. Giving anonymously via their DAF is also easy, if they so choose.
• Sue & Lou: Buying shares of a wildly successful stock several years ago paid off, and now this couple looks forward to reaping the benefits. In talking with their financial advisor, they realize that if they were to sell 100% of the stock, they would take a big tax hit on the investment gains. Their advisor points out that since they give charitably every year, they should consider donating a portion of their stock into a DAF and earn important tax benefits, including avoiding capital gains taxes and deducting the full fair market value of the donated stock. From there, they can divvy up the proceeds to charities of their choice via their DAF when they choose. Since donating stock to multiple charities would involve numerous contacts to coordinate the transactions, and since many nonprofits may not be equipped to coordinate the stock donation, a DAF simplifies the process.
To learn more about starting a DAF with the JCF, please contact me at (856) 673-2571 or email@example.com or visit jcfsnj.org/daf (Note: The JCF does not provide financial, legal, or tax advice, please consult your advisor as needed.)
From all of us at the JCF, we wish you a happy, healthy, sweet Passover!