Posts Tagged ‘Charitable organization’

Year End Tax Planning – Charitable Contributions

November 17, 2013 Leave a comment


Property, as well as money, can be donated to a charity. You can generally take a deduction for the fair market value of the property; however, for certain property, the deduction is limited to your cost basis. While you can also donate your services to charity, you may not deduct the value of these services. You may also be able to deduct charity-related travel expenses and some out-of-pocket expenses, however.


Keep in mind that a written record of charitable contribution is required in order to qualify for a deduction. A donor may not claim a deduction for any contribution of cash, a check or other monetary gift unless the donor maintains a record of the contribution in the form of either a bank record (such as a cancelled check) or written communication from the charity (such as a receipt or a letter) showing the name of the charity, the date of the contribution, and the amount of the contribution.


Tip: Contributions of appreciated property (i.e. stock) provide an additional benefit because you avoid paying capital gains on any profit.

News for Nonprofits

June 1, 2012 1 comment

Nonprofit Leaders Check Out Revised Publication 1771


Charity (Photo credit: Wikipedia)

There is a revised version of IRS Publication 1771, Charitable Contributions – Substantiation and Disclosure Requirements.  Nonprofit leaders should take note.

While most of the gift substantiation requirements have not changed, there are some updates regarding how acknowledgements may be made to donors.  For example, it is permissible for the nonprofit to provide acknowledgements electronically in order to meet gift substantiation requirements.

Please note that it is proper for nonprofits to acknowledge gifts in a proper and timely manner, however it is the responsibility of the donor to obtain an acknowledgement.

Visit the IRS website for this and other information for exempt organizations at


Considering a GRAT? Do It Now

October 19, 2010 Leave a comment
President's Advisory Panel for Federal Tax Reform

Image via Wikipedia

The end of 2010 is approaching and there still is no definitive word on the fate of the estate tax.  If and when the estate tax returns, it will surely heighten the need to look closely at your estate plans.  Be ready, because the estate tax could return in 2011 at a higher rate (55%) and a lower exemption amount ($1 million) than in 2009.

For your personal estate plans, take a closer look at the grantor-retained annuity trust, or GRAT.  This trust allows you to give a portion of an asset’s future profits to heirs tax-free.  They are attractive today while interest rates are low and they are good vehicles for transferring to your heirs stocks, real estate, shares in family limited partnerships, and shares in privately held companies.

The concern now is that Congress is looking for ways to raise revenue and the GRAT may take on some new restrictions.  Specifically, they may require a 10-year limit on GRATs which would make them less useful for people with shorter life spans.  Within that 10 years, if a GRAT owner dies the entire value of the GRAT generally becomes subject to the estate tax.  This affects those who have set up GRATs with a shorter term in mind, say 2 years, in order to lock in some short-term gains in order to be able to transfer most of the profits to their heirs.

If you are considering a GRAT, you may want to move on this now before a revenue-sniffing Congress makes changes.


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