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2007
Year-End Gift Ideas
As you consider your year-end
tax planning, we hope you will consider making good use of
the income tax charitable deduction. Your 2007 year-end
gift can significantly reduce your income taxes, while
providing meaningful support for us.
No matter what your income,
if you itemize, you can almost always lower your income
taxes through charitable giving. The amount of the income
tax savings will depend on your tax bracket.
Example: If
you are in a 33% income tax bracket in 2007, and you itemize
your deductions, a $1,000 gift to us by December 31 will
save you $330 in 2007 taxes.
Consider making more
charitable gifts in those years when you have the most
income – and are in the top federal income tax brackets. If
such is the case for 2007, you may wish to consider
accelerating future charitable gifts into this year. Check
with your tax advisor.
Giving is, of course, much
more that tax brackets and charitable deductions. Your
charitable gifts make an important difference in what we are
able to accomplish.
Here are some of the best
2006 year-end gift ideas. We would be pleased to provide
you with further information. Also, we urge you to discuss
your tax planning with you accountant or other professional
advisor.
Gifts of Cash
If you itemize, you can lower
your 2007 income taxes simply by writing us a check by
December 31. There is no easier way to garner a 2007
year-end charitable deduction! Make sure your envelope is
postmarked by December 31; if it is, your gift will qualify
as a 2007 gift even if it is not received by us until the
first week of 2008.
Some employers will match
charitable gifts, meaning your gifts are worth even more.
If your company or firm has a matching gift program, simply
enclose the form along with your check.
Gifts of cash are fully
deductible – up to a maximum of 50% of your adjusted gross
income. For example, if your adjusted gross income for 2007
is $50,000, up to $25,000 of charitable gifts may be
deducted in 2007. Any excess can generally be carried
forward and deducted over as many as five subsequent years.
Click Here to make a Gift of Cash
Matching Gift Program
Does your employer
sponsor a matching gift program? Please remember to
request a matching gift form from your employer, and sent it
- to CBC with your gift. The impact of your gift may
be doubled or even tripled!
Gifts of Stock
If you own stock, it is
almost always more tax-wise to contribute stock than cash.
This
is because a gift of appreciated stock generally offers a
two-fold tax savings. First, you avoid paying any capital
gains tax on the increase in value of the stock. Second,
you receive an income tax charitable deduction for the full
fair market value of the stock at the time of the gift.
Example:
If you purchased some stock many years ago for only $1,000,
and it is now worth $10,000, an outright gift of the stock
to us would result in a charitable contribution deduction of
$10,000. In addition, there is no capital gains tax on the
$9,000 of appreciation.
Make sure you have owned the
stock for a “long-term” period of time (this generally means
that you have held the stock for more than one year) to
qualify for these significant tax advantages. Your gift of
stock should be postmarked by December 31. In the
alternative, a stock broker or trust officer can arrange for
a year-end gift of stock from your account.
Gifts of appreciated stock
are fully deductible – up to a maximum of 30% of your
adjusted gross income. For example, if your adjusted gross
income for 2007 is $100,000, up to $30,000 of long-term
appreciated stock and other property gifts may be deducted
in 2007. Any excess can generally be carried forward and
deducted over as many as five subsequent years.
Gifts of Real Estate
A residence, vacation home,
farm, acreage, or vacant lot may have so appreciated in
value through the years that its sale would mean a sizable
capital gains tax. By making a year-end gift of this
property instead, you would avoid the capital gains tax,
and, at the same time, receive a charitable deduction for
the full fair market value of the property.
It is also possible to make a
gift of your home, farm, or vacation home so that you and
your spouse can continue to use it for your lifetimes –
while you receive a tax deduction in 2007. Please give us a
call for details.
Life Income Gifts
If you are considering a
major gift, a “life-income” gift may be an excellent
year-end gift. Such a gift can increase your own income!
You could transfer cash or
stock to us and establish a “charitable remainder unitrust”
or “charitable remainder annuity trust” that would provide
you with a 5% or greater annual return. This income would
be paid to you and/or a loved one for life, after which the
assets would be distributed to us. Through such an
arrangement, you would be increasing your income and making
a meaningful (and tax-deductible) contribution to us at the
same time.
Example:
Suppose Mrs. Barnes, age 75, purchased some stock may years
ago for $10,000 and that the stock is now worth $100,000.
But, she receives only $2,000 per year in dividends, or a 2%
yield. By transferring the stock to a charitable remainder
trust and specifying that she wanted a 6% return for life,
she could:
1.
Triple her
annual income (from $2,000 to $6,000);
2.
Avoid the
capital gains taxes that would otherwise be incurred on a
sale of the stock; and
3.
Be entitled to a
charitable contribution deduction of approximately $55,000.
(The amount of the deduction
depends upon the age of the donor, the rate of return
specified in the trust, the size of the gift, and other
factors.)
Bequests
While you’re considering your
2007 income tax savings, this may also be a good time to
consider long-term savings. The federal estate tax can
still take approximately 40% to 50% of one’s estate at the
time of death. That’s a higher tax bite than the income
tax! It definitely pays to do some advance planning with
your attorney and other professional advisors.
We hope you will consider a
charitable bequest in your will – to benefit us while you
save estate tax dollars at the same time.
Click Here
to make a Bequest or Retirement Plan Designation
For Further Information
We would be pleased to
provide you, your attorney, your accountant or your tax
advisor with additional information and assistance.
Please contact Peter Durant, Executive Director, at
508-992-6219. Keep in
mind that the information on this website is necessarily
general in nature. You should contact your own professional
tax advisor to learn how this general information relates to
your individual circumstances. Thank you for your interest
and support.
Tax-wise Tip: If you’re at
least 70-1/2, new tax legislation allows you to give CBC
(and/or other qualified charities) up to $100,000 directly
from your IRA without triggering federal income taxes. The
gift will also satisfy the rules for required minimum
distributions for the year. We’ll be glad to provide you
with the tax-wise details.
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