Food for Thought: Tax-Related and Planning Ideas for Your Charitably Inclined Clients

Laurie Valentine, JD
Counsel, Philanthropic Giving

Below are a variety of tax-related and planning ideas that provide for food for thought as you work with your charitably inclined clients:

New Era of IRS Scrutiny

A major portion of the $80 billion scheduled to be invested in Internal Revenue Service upgrades is earmarked to “increase tax compliance among wealthy taxpayers and businesses,” according to the IRS’s plan. Indeed, the IRS is investing upwards of $47 billion toward enforcement efforts, an amount that towers over the next-largest item on its spending plan, which is just over $12 billion slated for technology enhancements.

The heightened compliance efforts will generally apply to taxpayers making more than $400,000 annually. High-income earners and thus, donors to charity—and the financial professionals who serve them—should likely expect more in terms of attention, oversight, and audits.

A silver lining for advisors and their clients who work with us may be that the added potential IRS oversight plays to the foundation’s strengths. By offering donors fully-vetted grantee organizations, plus gift execution, documentation and compliance services, your charitable clients who’ve established donor-advised, field-of-interest, designated, or other funds at the community foundation can rest more easily knowing that their philanthropy is being handled as intended and able to withstand questioning, whether your clients are funding their contributions with Qualified Charitable Distributions (QCDs), highly-appreciated stock, or complex assets such as closely-held businesses and real estate.

Charitable Giving Conversations

As you talk with your clients about charitable giving, are you leading with tax benefits? Deferring philanthropy topics until November and December? Not looking at the big picture? If so, you may want to rethink your approach, according to a recent article (“4 Common Mistakes in Charitable Giving Conversations”).

Family Philanthropy

Our team also enjoyed digging into the latest study on family philanthropy, particularly because it reinforced so many of the best practices we already deploy here at Community Foundation Tampa Bay as we work alongside you to help your clients and their families make a difference in the lives of others for generations to come. We look forward to working together on practical solutions to engage your clients, their children, and their grandchildren in comprehensive philanthropic planning that moves the needle for the organizations and causes they care about.

The team at Community Foundation Tampa Bay is a resource and sounding board as you serve your philanthropic clients. We understand the charitable side of the equation and are happy to serve as a secondary source as you manage the primary relationship with your clients. This article is provided for informational purposes only. It is not intended as legal, accounting, or financial planning advice.  

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