Avoid Clients Leaving Charitable Dollars on the Table
Greater Cincinnati Foundation (GCF) is the region’s leading community foundation, bringing together people who care about a diverse range of causes and have a shared goal: to create a stronger, more vibrant community now and in the future in the tri-state region.
If you’re a professional advisor, GCF can partner with you to facilitate philanthropic conversations with clients that will enhance the overall value you provide – helping your clients reach their philanthropic goals while maximizing tax savings. As the year draws to a close, we’re working closely with tax advisors to avoid leaving dollars on the table. One of many items on the legislative “watch list” is the standard deduction. In 2026 the standard deduction for individual taxpayers younger than age 65 is scheduled to drop from $14,600 to $8,300 without intervening legislation.
While this may spell higher taxes for some taxpayers, the news could be positive for charitable giving. The Tax Cuts and Jobs Act of 2017 increased the standard deduction significantly. As a result, only 9% of taxpayers itemized deductions in 2020 compared with 31% in 2017. Although certainly not the only factor motivating charitable giving, tax incentives do play a role in donors’ decision-making about whether, when, and how much to give. Indeed, statistics recently released by the National Bureau of Economic Research indicated that the increased standard deduction resulted in $20 billion fewer charitable donations in 2018 alone.
Our team of philanthropic advisors at GCF are happy to work with you and your clients to map out a charitable giving plan to navigate anticipated changes in the law. For example, this year your clients might consider making two years of gifts upfront into their donor advised fund (DAF), with a plan to spread out the grants they make to their favorite nonprofits from the DAF over multiple years. This higher donation to their DAF in 2024, along with other itemized deductions, takes advantage of leveraging itemized deductions to surpass the standard deduction while it remains in effect.
It’s helpful to remind clients that donating highly appreciated marketable securities is a better choice than giving cash because it is extremely tax efficient. Stock given to a public charity, such as a donor advised fund at GCF, is typically deductible at the asset’s fair market value. GCF, in turn, pays no capital gains tax on its sale of the asset, thereby generating more dollars to support your client’s philanthropic interests than if the client had sold the stock and given the proceeds to their fund.
Now is a perfect time to connect with GCF to discuss your clients’ charitable giving goals. To learn more, please connect with Michele Carey, vice president, philanthropic strategies at 513-768-6171 or michele.carey@gcfdn.org.
