Happy Holidays!
As the holiday season approaches, our minds turn gratefully to those of you who have helped to make our progress possible. Those of us at ASHRAE Foundation hope you will accept our most sincere wishes for a safe and eventful holiday season for you and your family.
Support ASHRAE while saving on your taxes…
As you consider your charitable giving options for the remainder of 2010, remember that gifts made now can generate income tax deductions that could help reduce your tax bill for this year! Delaying or reducing gifts this year may result in more taxes being due next April 15th! The amount of your savings depends on tax rates and the portion of your gifts you are allowed to deduct. Also, if you are subject to the alternative minimum tax (AMT), you may be surprised to learn that charitable deductions help reduce the amount of both the regular income tax and the AMT.
What to give?
- Cash—Charitable gifts are most often made in the form of cash and checks. When you itemize your tax deductions, gifs of cash may be used to eliminate federal income tax on up to half of your AGI or adjusted gross income. You may enjoy state income tax savings as well.
- Stocks and Securities—Giving securities (stocks, bonds, or mutual fund shares) that are worth more than they cost can bring additional tax savings. Such gifts are generally deductible from income tax at their full current value if they have been owned for longer than one year, and they can be used to offset tax on up to 30% of your AGI.
- Retirement Plans—Retirement plan assets can be a practical source from which to make gifts. Unlike many other types of investment accounts, amounts withdrawn from retirement accounts can be taxable to you and eventually to your heirs if left to them.
If you are over 70 ½ and are required to take withdrawals from an IRA or other qualified retirement account, you may want to consider making charitable gifts using all or a portion of your mandatory withdrawal amount. Giving in this way may result in little or no tax impact when you report the amount withdrawn along with an offsetting charitable deduction.
- A gift through your will or living trust—With changes in estate taxes in recent years, many may find they can now leave more to loved ones free of tax. This may also make it possible to give more for charitable purposes, both now and as part of your long-range financial plans. After providing for loved ones, you can include a charitable gift of a specific amount, a percentage of your estate, a certain property, or “what’s left” after first providing for loved ones.
- Gifts of life insurance—If you own life insurance policies that are no longer needed for their original purpose, the cash value of such policies may be a source from which to make gifts that can provide welcome tax savings today and may also result in significant state and /or federal estate tax savings in the future.
- Gifts that provide income for you or others—There are also a number of ways to make gifts today that provide you or others with increased income, current and future tax savings, and other benefits for your life time or period of time you choose.
Remember that only gifts made by December 31 can help reduce the amount of taxes you owe next April. We will be pleased to provide more information to you and/or your advisors as you act to complete your plans.
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