Join us as we celebrate 80 years!
This year the Inland Empire Community Foundation (IECF) is celebrating its 80th Anniversary. In 1941, IECF started with a single gift when Charles Brouse, a local Riverside banker, wanted to help local students attend Riverside City College. He opened a scholarship fund for that purpose.
From his single gift, IECF has grown to invest and administer more than $120 million in charitable assets entrusted to us by generous donors for the benefit of students, individuals, families, and the pressing needs of our community.
During this landmark celebration of our 80th Anniversary, we invite you to celebrate the past and embrace the future with us by making a gift to improve the Inland Empire through IECF.
Here are a few ways for you, our donors, to make a gift that will make a difference this year!
In 2020, Congress passed the CARES (Coronavirus Aid, Relief and Economic Security) Act. The bill set forth temporary changes to encourage charitable giving during this challenging period. These changes end on December 31, 2021!
Donors can claim charitable income tax deductions for certain types of contributions made to qualifying charitable organizations like IECF. There are two specific types of donors who can make charitable gifts under the CARES Act:
- Donors who itemize on their taxes; and
- Donors who take the standard deduction.
For Donors Who Itemize on Their Federal Taxes
- Donor(s) can make a cash gift (cash, check, or credit card) to a qualified charity and may receive a charitable deduction on their federal taxes up to 100% of their Adjusted Gross Income (AGI).
Remember: The cash gift cannot be directed to a Donor Advised Fund (DAF), a supporting organization, charitable remainder trust, and certain types of private foundations; these do not qualify for this increased ability to offset adjusted gross income up to 100% with a charitable deduction.
For Donors who are non-itemizers and who take the standard deduction
- Donor(s) can make a cash gift of up to $300 to a public charity and use it as a charitable deduction (filing as single) on their federal income tax.
- For joint-filers (married couples) they can make a gift up to $600 and receive a charitable deduction for their gift.
Remember: The cash gift cannot be directed to a Donor Advised Fund (DAF), a supporting organization, charitable remainder trust, and certain types of private foundations; these do not qualify for this special “above the line” charitable deduction.
This “above the line charitable deduction” enables the majority of taxpayers who take the standard deduction to also benefit from their charitable gifts of cash.
Giving Gifts of Appreciated Assets
Another great way to give is to gift highly appreciated assets such as stocks, bonds, and real estate. Gifts of highly appreciated securities and real estate provide a double tax benefit:
- Donors can receive a charitable deduction based on the asset’s fair market value (FMV) on the date of contribution. Therefore, a donor can claim a charitable income tax deduction for the stock’s full fair market value.
- There is an avoidance of any built-in capital gains taxes owed on the gift (the difference between the donor’s basis in the stock/real estate when they purchased it and its FMV on the date of contribution). The gift will have no impact on cash flow or standard of living. It also offers a donor the opportunity of making a larger charitable gift than they thought possible.
Other possible appreciated assets to gift are business interests, art, antiques, and cryptocurrency.
Please confer with your legal or financial advisor to weigh the increased deductibility ceiling for cash gifts against the benefits of gifts of appreciated securities and/or real estate.
If you are 70 ½ or older, you probably have an IRA. You can make gifts out of your IRA to IECF or your favorite charity and have no tax consequences. This is called a “Qualified Charitable Distribution (QCD),” also known as an “IRA Charitable Rollover Gift.” This gift is money a donor can transfer directly from their traditional IRA account to a 501(c) (3) charity.
This is one of the most tax-efficient ways for older donors to make charitable gifts. This is because making a QCD lowers a donor’s taxable income as opposed to increasing their itemized deductions, which most donors no longer take when filing taxes. Donors can gift any amount up to $100,000 a year from their IRAs as a QCD. However, you will not receive an income tax deduction for your gift; instead, you will not be taxed on an IRA distribution that would otherwise have been taxable.
An IRA Rollover can also minimize the effect your giving has on your cash flow. The gift is from your assets, not your checkbook.
For those individuals who are 72 or older, your “IRA Rollover” gift can count towards your RMD (Required Minimum Distribution). Doing a “rollover” is easy. Contact your IRA administrator to get started with your gift by completing a simple form. Next, your IRA funds will be transferred to IECF, which supports our mission, and you can create your own fund!
Remember, the IRA charitable rollover does not qualify for a charitable tax deduction, however, you will not have to pay any taxes on any distributions. It is simply a transfer.
Other Gifting Options Available through IECF
A donor advised fund (DAF) is a great way to give and create a legacy. DAFs can be established at IECF. A DAF allows a donor the flexibility to achieve their charitable goals. It is a simple alternative to starting a family foundation and is designed for donors to be actively involved in directing how the funds are used.
You make an irrevocable contribution (cash or appreciated asset) to IECF to establish an endowed fund. With your gift, you receive an immediate tax benefit. You can also avoid capital gains taxes on gifts of appreciated assets. Once the fund is established, you are an advisor to the fund and can make recommendations on the distribution of the funds through grants to nonprofit organizations that you want to support. A DAF can also be established to offer scholarships to deserving students to continue their education. It is your choice of what you want to do.
IECF staff will work with you and your legal or financial advisor to determine the type of DAF you would like to establish. The DAF is created for perpetuity; therefore it creates a legacy for you, your partner, or your family.
Many of you may have savings accounts and CDs. These accounts are paying 2% or less. Depending on your age, a CGA can pay a higher rate of return, which can range from 4% to 9%, depending on your age. You can gift cash or appreciated assets to establish a CGA. You will receive an income tax deduction for your gift based on the asset given.
IECF has a license to offer CGAs. These are great tools if you are interested in receiving lifetime income from your charitable gift. They are very simple to establish. You as the donor can gift cash or transfer appreciated assets to IECF. In exchange for your gift, an individual or their spouse or partner can receive income for life (one or two lives), partially tax-free. Remember, the annuity is based on your age and the amount of the gift.
Help celebrate our 80th Anniversary by making a charitable year-end gift to IECF or your favorite charity!
For more information or assistance on any of these gifting options, please contact the Charitable Giving Department at 951-241-7777.
