Gifts of cash can be deducted against a larger portion of your taxable income than can gifts of appreciated assets. Cash is the simplest donation and provides us immediate benefits. Your gift can be made outright or fund one of our life income arrangements.
The IRS allows you to claim charitable deductions for gifts of cash up to 50 percent of your adjusted gross income ("AGI" -- the figure at the bottom of the first page of Form 1040. See glossary for full definition). Alternately, if you use appreciated property instead of cash to make your gifts, you can claim deductions up to only 30 percent of AGI. Although excess deductions may be claimed over the five years after the gift is made, if you are looking for substantial immediate tax deductions you may be better served giving cash instead of property.
This example is based on income tax rates that can change yearly. Contact our office for a personal illustration based on the latest rates.
|Gift of||Cash||Appreciated Assets|
|Amount of gift||$200,000||$200,000|
|Total charitable deduction||$200,000||$200,000|
|Deductible against % of AGI||50%||30%|
|Deduction in 1st year||$150,000||$90,000|
|Net taxable income, 1st year||$150,000||$210,000|
|Net tax in 1st year @35% rate||$52,500||$73,500|
If you are considering a gift of cash, e-mail contact:
Office Telephone: 410-225-2262