Strategic Giving to meet your Philanthropic Goals for Youth Mentoring
December 11, 2023, Katie Huynh
Did you know you can amplify your support of Big Brothers Big Sisters Twin Cities through strategic giving avenues that may also offer potential financial benefits? This year, explore the possibility of making a charitable contribution to youth mentoring through appreciated stock, a Donor Advised Fund, or via an IRA Charitable Rollover.
Your support helps us create impactful matches like Big Sister Chelsea and Little Sister Kasey, drive innovation (one of the reasons we won the “Agency of the Year” award from Big Brothers Big Sisters of America this summer!), and transform mentoring (check out our new strategic plan).
Stock Donations
Contributing appreciated stocks or securities directly to Big Brothers Big Sisters Twin Cities can yield significant tax benefits. By donating assets held for over a year, you may qualify for a charitable deduction equal to the stock’s full market value while avoiding capital gains taxes.
Benefits
- You receive a charitable income tax deduction equal to the current fair market value of the securities on the date of the gift, provided you’ve held them for more than one year.
- Selling appreciated securities typically incurs capital gains tax on the difference between the current fair market value and the original cost, potentially reducing your proceeds. However, by donating these securities to BBBS Twin Cities, you bypass the capital gains tax, and the organization can liquidate them, receiving the full 100% of the proceeds from the sale – creating more opportunities for Twin Cities youth!
Check with your broker to learn what kind of authorization they will need (generally a letter of instruction or authorization) and have the shares delivered to:
Morgan Stanley Smith Barney
Account holder: Big Brothers Big Sisters Twin Cities
DTC # 0015
Account # 364-112884-089
Be sure to let us know that you’re transferring stock to us so we can watch for it.
Donor Advised Fund (DAF)
Establishing a DAF enables you to make a charitable contribution, receive an immediate tax deduction, and subsequently recommend distributions to support Big Brothers Big Sisters Twin Cities over time. It provides a structured yet flexible approach to charitable giving.
Benefits
- Contributions via DAFs help donors maximize tax benefits.
- Charitable assets may grow over time, making more charitable dollars available to nonprofits.
- Donors can make an immediate contribution and make distributions to organizations like BBBS Twin Cities when ready.
IRA Charitable Rollover
Individuals aged 70½ or older can make a meaningful impact by directing up to $100,000 annually from their IRA directly to qualified charities like Big Brothers Big Sisters Twin Cities. This method fulfills required minimum distributions (RMDs) while offering a tax-efficient means of support.
Benefits
- By leveraging IRA Charitable Rollovers, donors fulfill their RMDs without increasing their taxable income. This means they potentially reduce their overall tax liability while supporting causes they care about.
- The rollover is made by simply instructing your IRA plan administrator to transfer funds directly from your IRA account to Big Brothers Big Sisters Twin Cities.
Exploring these sophisticated giving strategies could further amplify our collective impact.
Want to dive deeper into any of these options or need a hand getting the ball rolling? We would love to help! Contact Micaela at molson@bigstwincities.org or 651-789-2431 for more information.
Big Brothers Big Sisters Twin Cities does not offer tax, legal, or accounting advice. Before engaging in any transaction, we recommend consulting your own tax, legal, and accounting advisors to understand how it aligns with your individual situation.
