This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
$1 buys you full access to ALL of TheStreet's Subscription Services! Learn More

Schwab Charitable Reports 74% Growth In Contributions And Heralds A Strong Giving Season Ahead

Stocks in this article: SCHW

With the annual giving season underway, Schwab Charitable is expecting record levels of contributions as individuals and their advisors seek to meet charitable giving priorities while also navigating the uncertain outlook for taxes given the expiration of the Bush-era tax cuts at the end of this year. As of October 31, 2012, Schwab Charitable has seen an almost 75 percent increase in contributions year-over-year.

“November and December are traditionally a time when many people activate their giving strategies –contributing to their donor-advised account in advance of year-end contribution deadlines, as well as making grants to their favorite causes as part of their holiday giving traditions,” says Kim Laughton, President of Schwab Charitable. “This year in particular, we are already seeing an even more pronounced surge in activity as individuals look to reduce their estate sizes and tax burdens and maximize what they are able to give to charitable causes.”

A donor-advised fund allows investors to contribute cash or appreciated assets to a charitable account to realize the greatest possible tax benefits and to then more strategically support charity(ies) of their choice over time. Serving a wide range of philanthropic investors, Schwab Charitable’s account sizes range from $5,000 to almost $500 million.

Five Approaches to Tax-Smart Giving this Season

With the uncertain tax environment top of mind for many donors this season, Schwab Charitable has outlined five approaches for individuals and their advisors to consider as part of their financial and tax planning:

1. Reduce estate size before taxes rise and exclusion amount drops: With estate tax exclusions potentially decreasing from over $5 million to $1 million and estate tax rates set to potentially rise, individuals can make donations to charitable accounts that will enable them to immediately reduce their estate size and tax exposure and give more to important causes during their lifetimes.

2. Donate highly appreciated assets to charitable accounts to offset taxes from accelerating capital gains: Contributions can be made now to realize the maximum tax benefit but the donor can decide later what causes he/she wants to support.

3. Donate to charitable accounts in 2012 to lock in the maximum deduction: Some proposals to cap itemized deductions starting in 2013 could reduce the income tax benefits of future charitable gifts.

4. Donate to charitable accounts to reduce the income tax generated by a Roth IRA conversion: For individuals who are converting a traditional individual retirement account (IRA) to a Roth IRA, charitable giving can help to offset the taxes resulting from such a conversion.

5. Donate to charitable accounts to enable tax-free growth to support future giving: In general, putting as much money as the budget allows into non-taxable accounts enables potentially greater tax-free growth which, in the case of charitable accounts, can support an ongoing strategic giving strategy.

It’s the Most Wonderful Time of the Year...For Conversations with Clients about Charitable Giving

Charitable planning and giving is an important component of any tax planning or financial planning discussion, and conversations about giving intentions and strategies is a good way for advisors to build deeper relationships with clients.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,814.11 +95.11 0.54%
S&P 500 2,064.89 +12.14 0.59%
NASDAQ 4,725.5190 +23.6520 0.50%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs