Year-end giving helps Soulforce continue to fight Spiritual Violence and helps you save on taxes.
The tax laws intentionally encourage charitable giving. Because of the income tax charitable deduction, individuals who make their gifts by December 31 and itemize can significantly reduce their income taxes for the year.
Example: If you make a charitable gift of $10,000 in 2009, you can save $3,300 in taxes if you are in the 33% tax bracket. And the higher your tax bracket, the more money you save with a charitable gift. (A gift of $10,000 fully covers the cost of one National Direct Action.)
Giving is, of course, much more than tax brackets and charitable deductions. Philanthropy provides the meaningful difference in what we can do. As people of (any) faith, we need to give and work for a better tomorrow for gay, lesbian, bisexual, and transgender people everywhere.
Please discuss your year-end tax planning with your accountant or other professional advisor.
Gifts of Cash
There is no easier way to obtain a charitable deduction and support Soulforce at the same time than by simply writing a check. Make sure your envelope is postmarked by December 31; if it is, your gift will qualify as the current year gift even if it is not received by Soulforce until the first week of the new year. Mail your check to Soulforce, P.O. Box 2499 Abilene, Texas 79604.
If you itemize, your outright gifts of cash are fully deductible for federal income tax purposes up to 50% of your adjusted gross income. If your total gifts should exceed this limitation, the excess may be carried forward for tax purposes for up to five additional years.
Gifts of Stock
Year-end is an excellent time to consider a gift of stock. Giving longterm appreciated stock offers you two-fold tax savings. First, you avoid paying any capital gains tax on the increase in value of your stock. In addition, you receive a tax deduction for the full fair market value of the stock on the date of the gift. For income tax purposes the value of such gifts may be deducted up to 30% of adjusted gross income, with an additional five-year carry forward.
Example: If you purchased stock many years ago for $1000, and it is now worth $10,000, an outright gift of that stock to us would result in a charitable deduction of $10,000. In addition, you permanently avoid paying capital gains tax on the $9,000 of appreciation.
Gifts of Real Estate
If you have owned your home, a vacation home, acreage, or a farm for many years, a charitable gift of that real estate can be especially tax-advantageous. The property may have so appreciated in value over the years that its sale would result in a sizeable capital gains tax. If given to Soulforce instead, you avoid the tax and realize a charitable deduction for the full fair market value of the real estate.
You may also wish to consider a gift of your personal residence or farm, reserving the right to continue to live in the house for life (and, the lifetime of your surviving partner). Through such an arrangement, you will be entitled to a current income tax deduction for a portion of the fair market value of the property. See your tax advisor for details.
Gifts of Life Insurance
If you own a life insurance policy that is no longer needed, consider it as the perfect vehicle for a year-end charitable gift!
To receive a charitable deduction, name us as both the owner and the beneficiary of the policy. If the policy has a cash value, you can take a charitable deduction approximately equal to the cash value at the time of the gift. In addition, if annual premiums are still to be made and you continue to pay them, those premiums will become tax deductible each year. It’s easy to contribute a life insurance policy to us. Just check with your life insurance agent for details on which forms to complete.
Life Income Gifts
If you are considering a major gift, your gift of cash or stock in the form of a "life income gift" can significantly increase your income.
A life income gift allows you to transfer assets now, and yet continue to receive income from the cash, stock, or other property contributed. A life income gift can allow you to: increase your income for life; receive a generous charitable contribution deduction this year; and if you contribute stock, avoid any capital gains tax on the appreciation.
A life income gift is often made through a trust arrangement called a "unitrust" or an "annuity trust." with a unitrust, you and/or your spouse or other beneficiary receive annually a fixed percentage of the fair market value of the assets in the trust. The income received will vary from year to year, based on how the trust’s investments preform. With an annuity trust, you and/or your spouse or other beneficiary receive a fixed amount from the trust each year. This amount is agreed upon when you create the trust; it stays constant, no matter what happens with the stock market or interest rates.
If you have already considered a provision for us in your will, please note that a life income gift can often be preferable. Such a gift allows you to accomplish your goals during your lifetime and in a tax-advantaged way.
While you’re considering your income tax savings, this may also be a good time to consider long-term tax savings, The federal estate tax can still take approximately 50% of one’s estate at the time of death. It pays to do some advance planning with your attorney and other professional advisors. Soulforce hopes you will consider a charitable bequest in your will to benefit the GLBT community while you save estate tax dollars at the same time
For more information
Be sure to check with your accountant, tax attorney, or other tax advisor for additional information on how these general rules apply to your situation. See which year end gift opportunities will be most advantageous for your particular situation.
Thank you for your support at year-end, and throughout the year!