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Five Tips to Maximize Clients’ Year-End Giving

How to make charitable contributions go further.

Giving to charity is now easier than ever, especially during the holidays. Whether your clients write a check, “round up” at the register or simply click a “donate” button, they can quickly make a donation and be on their way. But after a few minutes, that good-deed feeling fades, and they may be left wondering if their contributions made a significant impact. What if you could help make their giving reach more people this year?

Here are five tips to help your clients maximize their giving, just in time for the holidays.

  1. Find matching opportunities. Many charities have annual fundraising campaigns with mega donors who match contributions—sometimes as much as 3:1—received during specified timeframes. Check to see if your clients’ favorite causes have similar opportunities that could double or even triple their impact and help the organizations reach their goals. Employers often offer matching programs, too, which can make a big difference to nonprofits. Your clients can even start a program in which they supply the funds for a future matching challenge.
  2. Make it a family affair. The holidays offer a rare opportunity to get the whole family together, and it’s the perfect time for your clients to get their kids and grandkids involved in giving. One idea is to create a “giving budget” to donate to charity. Each child then suggests a cause to help everyone decide where and how to distribute the “budget.” Actual dollars can then be given for the holidays – and even matched by grown-ups; the possibilities are limitless. Looking for more family-friendly giving ideas?  Foundation Source’s The Secret to Joyful Giving guide can help.
  3. Formalize their giving. If your clients don’t have a charitable vehicle but have been giving consistently and expect to give more in the future, several options are available to ensure their gifts are more organized, strategic and tax efficient. They can diversify and expand their giving with vehicles like a private foundation (PF) or a donor-advised fund (DAF) that will earmark assets for charitable purposes and potentially provide meaningful tax benefits. PFs offer flexibility, control and other unique advantages that support creative and entrepreneurial philanthropy. DAFs provide advantages like anonymity and higher tax deductions. Your clients can also incorporate their philanthropic objectives into their wills or estate plans and explore planned giving and trusts.
  4. Don’t forget Uncle Sam. Coordinating your clients’ charitable contributions with their tax strategy, estate planning and investment management could result in better outcomes – across all disciplines – and ensure that they get beneficial tax deductions, which in turn allows them to give more. With charitable vehicles like PFs and DAFs, they can maximize their tax savings and may be able to claim a same-year tax deduction.
  5. Know their minimums. If your clients have charitable vehicles with a minimum distribution requirement, make sure they know what it is and how much they have left to disburse so their assets are used for charitable purposes and not penalties. For example, PFs are required to annually distribute at least 5% of the previous year’s average net assets. Qualifying distributions from the PF include grants to public charities, administrative expenses and certain costs related to carrying out the PF’s charitable purpose, such as a building, computers and office furniture.

Hannah Shaw Grove has spent three decades studying and working with high-net-worth families, family offices and their closest advisors on achieving their wealth management priorities. She is the chief marketing officer at Foundation Source, the nation’s largest provider of support services to private foundations. The firm works in partnership with financial and legal advisors as well as directly with individuals and families.

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