Year-End Tax Information

As you plan your end-of-year charitable giving, CFNLA is here to help you achieve meaningful impact in our community while maximizing your charitable tax deductions. 

Establish a Donor Advised Fund

To itemize deductions on your 2022 tax filing, your deductions must exceed $12,950 for an individual or $25,900 for married couples filing jointly. To meet this threshold, you can use a Donor Advised Fund (DAF) to condense several years of charitable giving and gain the maximum tax benefit allowed.

  • DAFs allow donors to make a charitable donation and claim a deduction in 2022 even if grants to charitable organizations of the donor’s choice are made in a later year;
  • DAFs can be opened in one day with a minimum contribution of $5,000;
  • DAFs allow donors to consolidate all annual charitable giving such that the donor receives only one tax receipt while supporting multiple charitable organizations;
  • Donors may contribute cash, securities, real estate and other appreciated assets;
  • DAFs may be either endowed or unendowed depending on the donor’s preference;
  • A donor creating a fund with a minimum contribution of $250,000 may recommend a financial advisor for the fund (pursuant to certain conditions); and
  • Unlike a private foundation, a DAF does not have an annual payout requirement.

Using Your IRA RMD to Make Charitable Contributions

  • Individuals age 70½ and older can donate up to $100,000 per year in IRA assets.
  • These “Qualified Charitable Distributions” (QCDs) may be made tax-free if directed to a nonprofit like CFNLA and can satisfy your Required Minimum Distribution (RMD).
  • While the IRS does not allow IRA donations to DAFs, donations may be made to other funds at CFNLA.

Contribute Appreciated Non-Cash Assets

  • An effective strategy to maximizing charitable giving while minimizing taxes is donating appreciated stock.
  • Appreciated stock gifted to CFNLA is exempt from capital gains tax.
  • There may even be advantages to selling stocks at a loss and donating the sale proceeds. We recommend you discuss this with your tax advisor.

CFNLA recommends donors discuss all giving strategies with a tax advisor. 

Click here for more information about charitable fund types or other ways to make your year-end charitable impact.