If you find yourself having a high-income year — because you received a large bonus or equity compensation or realized gains from a long-term investment — you may be looking to reduce your tax liability.
Before meeting with your financial advisor to make a plan, we invite you to prayerfully consider how you’re called to share your blessings. This might be an opportunity to offer compassion to your neighbor and to love as St. John the Beloved instructed: in deed and truth (1 John 3:18).
Amplify Your Generosity
If you want to ensure more of your dollars get to the ministries and causes you care about most, you may want to leverage one — or all — of these giving strategies.
01 Give Appreciated Assets: The most common example is a donation of stock shares to your parish. You can claim a charitable deduction for the gift, and you don’t have to pay taxes on the capital gains. This strategy works similarly with other appreciated assets, such as real estate, personal items, or a business.
02 “Bunch” Your Giving: By combining charitable gifts from two or more years into a single tax year, you might be able to exceed the standard deduction this tax year. Then, in the off years, you might take the standard deduction.
03 Use a Donor Advised Fund: A donor advised fund allows you to “bunch” your gifts in a single tax year and maintain consistent and steady support to your favorite charities. It’s like a charitable checking account — you make a gift into a fund and distribute grants from it on your own timeline.
When you partner with the Catholic Community Foundation of Minnesota (CCF) for your charitable giving, we can ensure your smart giving aligns with your faith and values. We invest charitable funds following the strategies outlined in the United States Conference of Catholic Bishops’ Socially Responsible Investment Guidelines: “1) to avoid participation in harmful activities, 2) to use the Conference’s role as stockholder for social stewardship, and 3) to promote the common good.” And we screen all grantees to ensure their work is not antithetical to Catholic teaching.
The information provided above by the Catholic Community Foundation of Minnesota (CCF) is general and educational in nature. CCF and its staff do not provide individualized legal or tax advice. We recommend you consult with your attorney or tax professional regarding your unique personal situation.