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Did you know that donating appreciated stocks can be a tax-smart way to give? By gifting stocks to Kitsap Community Foundation or your favorite nonprofits, you can avoid capital gains taxes on the appreciation and receive a charitable deduction for the full market value of the stock. This means you can maximize your impact while minimizing your tax liability. Your stock gift can support vital programs and initiatives, creating lasting change in our community. Learn more by clicking here.

Maximize charitable impact and minimize taxes by donating appreciated non-cash assets (publicly traded securities, restricted stock, and private business interests) held longer than one year. Eliminate the capital gains tax (typically 15-20%) otherwise incurred if assets are sold first and then proceeds donated. 

One powerful way to give smartly is through Donor-Advised Fund (DAF) grants. By leveraging your DAF, you can make a difference in our community while enjoying immediate tax benefits and the flexibility to support multiple causes over time. If you don’t yet have a DAF, reach out to Kitsap Community Foundation and we can help you set one up before the end of the year. If you already have a DAF outside of KCF, you can recommend a grant to KCF to support ALL the nonprofits in Kitsap and North Mason Counties. It's a win-win for you and the causes you care about. Learn more by clicking here.

Any contributions of cash or non-cash assets received by December 31 are eligible for a 2024 tax deduction. Donors may then take time to develop a strategic giving plan and recommend grants to charities in 2025 using the charitable dollars set aside in 2024. 

If you are 70.5 years or older and have an Individual Retirement Account (IRA), you have the opportunity to make a Qualified Charitable Distribution (QCD). QCDs allow you to donate directly from your IRA to Kitsap Community Foundation, satisfying your required minimum distribution while reducing your taxable income. This tax-smart strategy empowers you to support the causes you care about most while enjoying potential tax advantages. It's a meaningful way to make a difference while optimizing your retirement savings. Learn more by clicking here.

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Individuals aged 70.5 and older can direct up to $100,000 per year from their traditional IRAs to operating charities through QCDs. The QCD can be used to satisfy all or part of the donor’s RMD for 2024 and is not considered taxable income for the donor. Note: two individuals who submit tax returns with married filing jointly status each qualify for an annual QCD of up to $105,000. A donor wishing to make a 2024 Qualified Charitable Distribution should submit the request by the end of November to ensure the gift is received by December 31. 

In a process called tax-loss harvesting, capital losses can be used to offset capital gains and up to $3,000 of ordinary income. Donors can then claim a charitable deduction if they donate cash from the sale proceeds. 

Reduce the tax impact of rebalancing their portfolio by claiming a charitable deduction for donating appreciated assets in an amount that offsets the capital gains tax on selling appreciated assets. 

Contribute your residence, vacation home or farm now, while retaining the right to use and occupy the property for life. At your death, the charity gifted the real estate will own the property in its entirety. Note: contributions of real estate require special steps and additional time, including a qualified appraisal of the assets. 

In a charitable bargain sale, you sell your real estate or securities to a charity for less than fair market value. The difference between market value and the purchase price represents your donation, which qualifies for an income tax deduction and is exempt from a capital gains tax. Note: contributions of real estate require special steps and additional time, including a qualified appraisal of the assets. 

For donors who itemize deductions on their annual tax returns, specific limits apply to charitable deductions to public charities, including contributions to donor-advised funds:

• General Limit on Charitable Deductions: Donations to public charities are generally limited to 50% of adjusted gross income (AGI).

• Cash Gifts: This limit increases to 60% of AGI for cash contributions.

• Appreciated Assets: Donations of appreciated non-cash assets held for more than one year are limited to 30% of AGI.

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If donation amounts exceed these AGI limits, any excess can be carried forward for up to five subsequent tax years.

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Standard Deduction Amounts for 2024

Many donors itemize deductions because their total deductions exceed the standard deduction. For 2024, the standard deduction has increased due to inflation adjustments:

• Single filers: $13,850

• Married couples filing jointly: $27,700

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As always, please consult your tax advisor for additional guidance. Please don’t hesitate to reach out for more information or to discuss options. We can be reached at info@kitsapfoundation.org or (360) 698-3622.

This year-end, consider the most thoughtful gift for your family – a completed will. A completed will provides:

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1. PEACE OF MIND: Ensure your loved ones’ financial security and protect their future. A will gives you control over how your assets are distributed. 

2. PROTECTION OF FAMILY AND PETS: Carefully selecting and naming guardians for your children or pets and providing clear instructions eases the emotional burden during difficult times.

3. FAMILY HARMONY: Avoid potential disputes and conflicts among your heirs and beneficiaries by clearly stating your wishes,  while sparing your loved ones from the stress of unnecessary legal complexities and potential disputes.

4. MINIMIZE TAXES: Proper estate planning can help significantly reduce the tax burden on your estate, and potentially free up funds to support your favorite causes.

5. LEGACY OF LOVE: Leave a lasting legacy by supporting causes dear to your heart. Naming your favorite causes in your will—either directly or through the Kitsap Community Foundation—ensures that the mission that speaks to your heart will endure beyond you.

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