Are you in the mood to give to charity? No matter what your economic situation is you should give something to charity. No matter how bad you think you may have it there is always someone somewhere who does indeed have it worse than you. No matter if you give $10 or $100,000 it is the right thing to do. If you cannot afford to give cash many charities accept donations of property provided it still has some use left in its life. And neither of those is an option you can donate your time to the charity as most accept volunteers to do work.
If you are making a sizable donation of cash or a cash equivalent to a charity ask the charity if there is a better time to donate as compared to just making a donation. Most charities get most of their donations during the holiday season so it may be better for them to get your gift in the spring or summer. Also check with the charity to see if they prefer to get a lump sum or have it spread out over months or years. But no matter what there are advantages to you for giving. Not only is the donation a tax deduction but the feeling for helping others who are less fortunate is worth something as well.
If the cash donation is very large or you are donating an appreciated asset such as a stock position that you have owned for at least a year and it is worth considerably more now than it was when you purchased it there are several option for making your donation. One option is a charitable gift annuity where you give cash or an asset to the charity and they will in turn buy an annuity for you or your beneficiaries. There are some tax situations here that should be discussed with a tax professional if you go this route for your donation.
If you are in the position that you have an asset that has appreciated a lot giving it to charity may make the most sense. As your cost basis in the asset is low and by selling it you would see a large capital gain that would be taxed an option is to donate the asset to a charity. By donating an appreciated asset to charity instead of selling it and donating the proceeds you are not taxed on the gains and you will benefit from the full appreciated value of the assets as a tax deduction.
If you want to make the donation and are not sure what charity to donate to there is an option for you as well. You are able to donate cash or assets to a donor-advisor fund that are operated through many mutual fund companies. The nice thing about this avenue of donating is you get the tax advantages now but do not have to name a charity in many instances what could be years. There is a plan administrator that will oversee the account and does have final say in what happens to the funds but in the majority of instances the donor’s wishes are complied with and met.
Charities exist for a purpose and that is to help those who are in need of help. No matter if it is a monetary donation or a donation of time making any donation is the right thing to do. Some people are in a better position to help more than others but no matter what your economic means are there is something you can do to make someone’s life easier or make their day a little bit better.
