SAN FRANCISCO--()--Schwab Charitable, one of the nation’s leading national donor-advised fund organizations, is reminding advisors and investors that year-end deadlines for charitable giving are fast approaching and that there are multiple ways, from cash contributions to the donation of appreciated assets, that individuals can realize tax benefits from charitable giving this year.
“Because of expected tax changes, many clients who are making adjustments to their portfolios are also transferring some shares directly to their charitable accounts to offset some of the tax burden.”
The traditional giving season is well underway and Schwab Charitable is already seeing a strong uptick in activity. Contribution levels have increased 40 percent and new accounts are up 48 percent over the same period last year.
“Individuals and their advisors increasingly understand the value and ease of use of donor-advised funds to empower their charitable giving and reduce their tax liabilities,” said Kim Laughton, president, Schwab Charitable. “We have seen a 54% jump in calls this season from both existing and potentially new clients who want to know more about the ways in which they can use a donor-advised fund in their financial planning, especially given the uncertain tax landscape ahead.”
A donor-advised fund allows investors - either directly or with the help of an investment advisor - to contribute cash or appreciated assets to a charitable account to realize the greatest possible tax benefits and to then support charities of their choice over time. Serving a wide range of philanthropic investors, Schwab Charitable’s account sizes range from $5,000 to more than $500 million.
Appreciated Assets Can Be Among the Most Tax-Advantaged Items
With only a few weeks left in the year, investors and advisors are finalizing their year-end tax strategies. As a part of this planning, they are taking a look at appreciated stocks, mutual funds and other assets in their portfolios. Appreciated assets can be the most tax-advantaged items to contribute to charity because they give investors a current year tax deduction and also allow them to avoid payment of capital gains taxes on their sale. Giving appreciated assets to a donor-advised fund is often much easier than distributing directly to a variety of charities, who can find these gifts administratively costly and burdensome and would prefer to receive a simple check from the donor-advised fund account.
“Donor-advised funds allow easy conversion of appreciated assets in an investment portfolio into tax-effective charitable gifts,” said Laughton. “Because of expected tax changes, many clients who are making adjustments to their portfolios are also transferring some shares directly to their charitable accounts to offset some of the tax burden.”
Year-End Contribution Deadlines
As 2012 comes to a close, Schwab Charitable reminds individuals who are still looking to make contributions to its donor-advised fund and realize a 2012 charitable tax deduction of some important contribution deadlines:
|Donor deadline||Contribution type|
|December 21, 2012||Wire transfers from a non-Schwab financial institution|
|December 31, 2012||Transfers from a Schwab brokerage account|
|December 31, 2012||Checks|
|December 31, 2012||Security certificates which are in good order|
About Schwab Charitable
Created as a national donor-advised fund with a mission to increase charitable giving nationwide, Schwab Charitable has received $6.5 billion in contributions and has facilitated $3.2 billion in grants to charities on behalf of its donors since inception. Serving a wide range of philanthropic investors, account sizes range from $5,000 to more than $500 million. Schwab Charitable has been a pioneer in enabling investment advisors to manage the investments of donor-advised accounts and remains a leading provider of such professionally managed accounts. It currently has relationships with 964 registered investment advisory firms. Schwab Charitable also offers a private foundation conversion service for private foundations considering donor-advised funds as a complementary or alternative charitable vehicle. For more information, visit schwabcharitable.org.
A donor’s ability to claim itemized deductions is subject to a variety of limitations depending on the donor’s specific tax situation. The tax information herein is general in nature and not intended as specific, individualized advice. Where such advice is necessary and appropriate, donors should consult with their tax and/or legal advisors.
Professionally‐managed accounts are available only through independent investment advisors working with Schwab Advisor ServicesTM, a business segment of The Charles Schwab Corporation serving independent investment advisors and includes the custody, trading and support services of Charles Schwab & Co., Inc. While donors may recommend an advisor, the Fund must approve the recommendation. Advisors must meet certain eligibility requirements and adhere to Fund fee and investment guidelines. You may request a copy of the investment guidelines by calling us at (800) 746‐6216.
Schwab Charitable is the name used for the combined programs and services of Schwab Charitable Fund, an independent nonprofit organization. The Fund has entered into service agreements with certain affiliates of The Charles Schwab Corporation.
©2012 Schwab Charitable Fund. All Rights Reserved. (1212-8288)