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Gifts of Cash
Gifts of cash can be deducted against a larger portion
of your taxable income than can gifts of appreciated assets. Cash is
the simplest donation and provides us immediate benefits. Your gift can
be made outright or fund one of our life income arrangements.
The IRS allows you to claim charitable deductions
for gifts of cash up to 50 percent of your adjusted gross income ("AGI" --
the figure at the bottom of the first page of Form 1040. See glossary
for full definition). Alternately, if you use appreciated property instead
of cash to make your gifts, you can claim deductions up to only 30 percent
of AGI. Although excess deductions may be claimed over the five years
after the gift is made, if you are looking for substantial immediate
tax deductions you may be better served giving cash instead of property:
For charitable gifts of cash, the IRS allows you to claim
up to 50% of your adjusted gross income ("AGI"). However, for
charitable gifts of appreciated assets, you may deduct up to only 30% of AGI in any one year. The good news is that with both types
of gifts if you cannot use all of the deduction in any one year, then you may
carry over any remainder for the next five years. We have illustrated this
below.
 Gift
of:
|
Cash |
Appreciated
Assets |
Donor's
AGI |
$300,000 |
$300,000 |
Amount
of gift |
$200,000 |
$200,000 |
Total
charitable deduction |
$200,000 |
$200,000 |
Deductible
against % of AGI |
50% |
30% |
Deduction
in first year |
$150,000 |
$90,000 |
Net
taxable income, first year |
$150,000 |
$210,000 |
Net
tax in first year @35% rate |
$52,500 |
$73,500 |
Carryover
deduction |
$50,000 |
$110,000 |
*This example is based on income tax rates that can change yearly. Contact
our office for a personal illustration based on the latest rates.
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If you are considering a gift of cash, email us,
complete the personal illustration form,
or call us at (727) 864-8229 so that we can assist you through
every step of the process.
Judi Schraer
Director of Gift Planning
Eckerd College
4200 54th Avenue South
St. Petersburg, FL 33711
(727) 864-8229
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