News for Professional Advisors
The Advisor Resource: August 2021
At the Community Foundation, our goal is to serve as an extension of a professional advisor's team. Offering our expertise in philanthropic planning and community investment, we're here to help build a tailored giving plan that aligns with an individual's interests, values and charitable goals, while also maximizing important tax advantages and key benefits.
The Advisor Resource is an occasional eNewsletter designed to provide attorneys, accountants and financial advisors with helpful resources and information to better serve their clients.
Our August 2021 issue includes:
IN FOCUS: Recent Sale of Raven Industries Is a Good Reminder Why Donating Appreciated Stocks Makes Great Sense
As an advisor, you've likely counseled clients through different taxable events. Maybe the sale of a business. Maybe a property inheritance. Or, maybe you've worked with clients who own stock in a business like Raven Industries that’s recently increased in value.
But, did you know your clients can reduce their taxation from these events by donating those non-cash assets to a donor advised fund at the Community Foundation?
Donating appreciated assets such as stocks and securities has always been a tax-wise philanthropic strategy. This method not only allows a donor to avoid capital gains tax, it also provides an immediate deduction for the fair market value of the asset. What’s more, it gives donors time to thoughtfully consider where and how to apply their charitable gifts for the greatest impact.
While donating appreciated stocks and securities has always been popular, with new proposed tax law changes on the horizon, we are predicting an even greater surge in the number of donors who choose to use non-cash assets to fund their philanthropy.
Preliminary proposals and several bills recently introduced in Congress may provide an even greater incentive for gifts of appreciated assets. Currently, high-income earners pay a 20% capital gains tax when selling assets held for longer than one year. Under one proposal, those who earn more than $1 million could see a 39.6% capital gains tax rate, with the tax hike retroactive to the date of announcement.
Of course, the tax change is still under negotiation and it’s tough to predict whether the retroactive capital gains tax increase will survive negotiations in Congress.
Whatever changes may happen, there’s simply never been a better time for your clients to make a gift of appreciated stock or securities to support the charities that matter most to them. And again, it’s important to remember: When your clients make outright gifts of appreciated assets, they essentially receive a double benefit: they’ll eliminate capital gains tax and they’ll receive an immediate deduction of the fair market value of their asset.
Want to learn more about how to help your client donate non-cash assets? We’re here to help! Contact us at 605.336.7055.
Manage the Assets of Your Client's Donor Advised Fund With Our Individually Managed Fund Program
If you do have clients who could benefit from a donor advised fund, it's important to know that you can continue to serve their financial investment needs and interests through our Individually Managed Funds program.
We developed this program because we know that as an advisor, you’ve spent years getting to know your clients and their financial goals, and that you've work hard to help them reach their highest aspirations. This program allows external investment advisors to manage the assets of a donor advised fund while the Community Foundation provides philanthropic services and community insights.
Want to learn more about our Individually Managed Funds program? Give us a call at 605.336.7055.
Seeking Solid Ground: Guiding Charitable Clients Through 2021's Choppy WatersAs the Delta variant threatens pandemic recovery, and talk of tax reform bubbles up more and more frequently, it’s no wonder your clients are on edge. For attorneys, accountants, and financial advisors like you who counsel families on philanthropic planning, 2021 seems to have generated more questions than answers.
We understand, and we're here to help. Our goal at the Community Foundation is to serve as a steady, reliable philanthropic partner and as a source of timely information and ideas that enable you to serve your clients without missing a beat, even in the face of uncertainty. Meet our team.
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