Charitable Giving Tax Tips

Are you wondering what to ask your tax advisor this season with the changes in tax law? Want to be informed about how these changes will impact you and your financial well-being? Use these tax tips and information on charitable giving to spark discussion with your advisor and maximize your deductions:

Review your beneficiaries.

Tax season is a perfect time to review your beneficiary status. Take special note of assets such as retirement plan accounts since the beneficiary for these accounts is not governed by your will. Additionally, retirement plan accounts are a great asset to leave to charities, who pay no income tax on them. Heirs are not only subject to income taxes on those funds, but the Secure Act requires that they withdraw assets within 10 years.

Donate appreciated assets.

Donating assets that have appreciated in value (like stock, mutual funds, property) can give you a double deduction: deduct the fair market value of property owned for at least one year and avoid capital gains tax.

Utilize retirement assets.

If you are age 70 ½ or older, you can transfer up to $100,000 annually to a qualified charity, tax-free. The age to take your Required Minimum Distribution (RMD) has increased from 72 to 73 for individuals who turn 72 after December 31, 2022, and turn 73 before January 1, 2033. It raises this age to 75 for individuals who turn 74 after December 31, 2032.

Combine multi-year deductions into one year.

Many taxpayers won’t qualify for the necessary deductions to surpass the standard deduction threshold established by tax reform in 2017. However, you can still receive a tax benefit by “bunching” multiple years’ worth of charitable giving in one year to surpass the itemization threshold. In off years, you take the standard deduction.

New laws enable Qualified Charitable Distribution (QCD) can be used to fund Charitable Gift Annuity (CGA).

Beginning in 2023, donors over age 70 ½ will be able to make a Qualified Charitable Distribution (QCD) in exchange for a charitable gift annuity (CGA) which can be an appealing and viable option for some donors. This will also count toward satisfying your minimum distribution requirement.

Consider these charitable giving tax tips as you plan ahead for your 2023 donation! For more information on how charitable giving can be part of your financial well-being, please contact your financial advisor or reach out to Tricia Morrill at (612) 756-2063 or

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