Giving Back and Looking Forward

November 20, 2017

As the year winds down, discussions with our clients increasingly address their plans for giving back. During this time, we help fine-tune gifting strategies, optimize charitable contributions, and choose appropriate gifting vehicles. While these conversations happen every year, they have taken on a heightened resonance given the many communities around the globe impacted by 2017’s string of natural disasters.

If giving back has also been on your mind, we thought it could be helpful to share some of the tips and strategies we find useful in our planning discussions with clients:

  • Start with your goals in mind—it is important to first understand the ultimate plan for a gift: is it a one-time donation, part of a broader and ongoing gifting plan, or a step in the process of creating a charitable legacy? This framework helps determine the optimal strategies to use for gifting.
  • Review your gift plans within a broader financial plan, which helps ensure that long-term financial needs will be met alongside the goals for gifting.
  • Carefully select sources for gifts—for example, we often suggest gifting appreciated investments or other property rather than cash, as this can help make the gift more cost effective and tax advantageous.
  • Consider the flexibility offered by donor-advised fund accounts, which allow for separate timing of the tax-deductible charitable gift from the eventual receipt of donations by selected charities and organizations.
  • Review the estate tax advantages of gifting to family and be sure to utilize the annual exclusion amounts when appropriate.
  • Incorporate gifting into overall tax planning, which is important so we can optimize the impact of the gift while also reducing the tax burden.

On a more personal note, some of our clients have asked about Litman Gregory’s own charitable activities. Giving back to our community is a deeply embedded value for us, one we share with many of our clients. Through our Charity Partnership Program, we support two organizations in the San Francisco Bay Area that work to end family homelessness: SHELTER, Inc. and Compass Family Services, and we also provide a charitable gift-matching program for our employees. More recently, with so much of our immediate community impacted by devastating fires, we, as a firm and as individual employees, have directed additional donations to Northern California victims through two long-standing local organizations: Napa Valley Community Foundation and Sonoma County Community Foundation. In keeping with the advice we would give our clients, we carefully planned our giving to support these entities in a way that should generate the most impact.

Whatever your needs are around giving back, our primary responsibility as a fiduciary to our clients is to ensure that gifting choices appropriately support long-term goals and represent the most financially responsible strategies for each individual or family’s situation.

If you would like to learn more about specific gifting strategies, call your Litman Gregory Wealth Advisor to start a discussion, or contact us here. We still have time to help you put all the pieces in place before the end of this tax year.

 

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