Philanthropy is a powerful way to shape one’s legacy, creating a meaningful impact that can inspire generations. At its heart, philanthropy is about leaving the world better than we found it. Engaging in charitable work and supporting causes that align with your vision allows you to create a lasting influence on communities and causes that matter most to you. Philanthropy doesn’t have to just be financial—it includes dedicating your time, skills, or other resources to strengthen communities, connect with others, and give back with purpose.
As we move into 2025, it is important to consider how philanthropy can play a consistent role in your annual financial planning as well as your estate planning strategy. Thoughtful charitable giving isn’t only about immediate impact—it also provides long-term benefits, from tax advantages to enriching your legacy in a meaningful way. Whether it's giving back seasonally or as part of a strategic plan throughout the year, intentional philanthropy can have a lasting effect.
Let’s explore some impactful, tax-smart strategies that you can incorporate into your financial lifestyle that align with your values.
Making charitable donations can reduce your taxes through a tax credit. Donations up to $200 qualify for a 15% tax credit, and for those above $200, the credit increases to 29%.
In-Kind Donations of appreciated investments, such as stocks or bonds, allow you to support a charity while avoiding capital gains tax.
A Donor-Advised Fund (DAF) allows you to make a large upfront donation for a tax credit, with the fund managed by a third-party entity. You can suggest how donations are made annually, while the DAF handles administration and investments. This option is typically suited for contributions of $25,000 or more.
Bunching Donations involves combining multiple years' contributions into one year to exceed the standard deduction threshold, allowing you to itemize in that year and take the standard deduction the next.
It’s a great time to revisit your giving strategy and consider how it can enhance your estate planning goals for 2025 and beyond. Connect with our team today to discuss how intentional philanthropy can shape your legacy and transform your financial strategy to reflect your values.
