Did You Hear About Tax Advantage Giving?

One in three Americans gave to non-profit organizations during the first half of 2020.  You were likely one of them! During challenging times, many of us are drawn to help provide aid to those in need.

We are grateful for everyone who supported more access to fresh food and local farms in 2020 through donations to Sierra Harvest.  As we approach tax season, we wanted to share some resources so that your generosity can also create tax advantages for you and your family.

New $300 Tax Deduction for 2020
Before the 2020 CARES Act, charitable donations could only be deducted if taxpayers itemized their deductions.  But now, taxpayers who don’t itemize deductions may take a charitable deduction of up to $300 for cash contributions made in 2020 to qualifying organizations. Find out more about this tax benefit.

Designate Retirement Funds
Retirement plans are taxed higher than other funds, so they are an ideal opportunity for charitable giving once you no longer need the assets.

“One of the easiest ways to support a local non-profit you love is to include them as a beneficiary of your retirement plan” says Valerie M. Logsdon, Elder Law Attorney with over 25 years of experience helping address the needs of elders and their families.  “Leaving retirement assets to a charity is easy and you don’t need a will. Simply update your beneficiary designation form with your plan administrator.”

Valerie explains how this can work to your family’s advantage.  “For example, if a child receives $1000 from an Individual Retirement Account (IRA), the child only receives about $800 because he or she pays federal and state taxes on those funds. If the child withdraws all of the IRA funds immediately after a parent’s death, this becomes significant income in that year, making the tax rate even higher than 20 percent. However, if you designate a non-profit as recipient of any benefits remaining in your retirement plan, you may effectively reduce the taxes on those assets.”

If you choose to designate Sierra Harvest as a beneficiary of your retirement plan, please let us know so we can thank you for your generosity and show you the impact your gift will have.

Looking for Other Ways to Gain Tax Advantages?
Join us on zoom Tuesday, March 2nd, for an hour-long discussion on tax-advantage giving with local estate attorney Dylan Hendricks.  She is a board member of the Center for Nonprofit Leadership and enjoys sharing information that will ultimately benefit our entire community.

Reserve your space and confirmation details will follow.