As we approach the Holiday Season, we want to share some year-end charitable and family gifting reminders.   The following list contains general information for your review and consideration.   The first and best rule in year-end planning is to make your donations and gifts well ahead of the December 31 deadline.



The Basics.

  • A gift to a qualified charitable organization (a U.S.-based 501(c)(3) organization) may entitle you to a charitable contribution deduction against your income tax if you itemize deductions. (If  you itemize, your total deductions are greater than the standard deduction; otherwise stay with the standard deduction). [1]
  • December 31 is the deadline for charitable gifts.
    • Cash gifts
      • If you plan to send your donation via check in the mail, send it early enough so that it is postmarked on or before December 31. Note that the “mailbox rule” only applies to U.S. mail.
      • If you pay for your donation by credit card, the transaction is official once the charge is made, not when you pay the bill.
    • Other-than-cash gifts
      • If you contribute stocks or other property owned for more than one year, the value of the deduction is normally equal to the property’s fair market value.
      • If you choose to donate stock, the transaction is only recognized as completed once the transfer request has been submitted.
      • If you choose to donate physical assets, such as art work, the delivery and transfer of the title or deed must happen before December 31.
      • If you donate a car worth more than $500, then you can only deduct the amount the charity received from the sale of your car.
  • There are limits to how much you can deduct, but they’re very high.   Only if you contribute more than 20% of your adjusted gross income to charity is it necessary to be concerned about donation limit
  • If your gift exceeds $250, you need to get a receipt. A cancelled check or a brokerage certificate showing a transfer of shares is not sufficient.  Additionally, you must have that receipt in hand by the time you file your taxes in April. If you file for an extension, you will need to have documentation of your gift by the time you file in October.

Gifts from your IRA.

If you are over age 70½ by December 31, you can make a charitable donation directly from an individual retirement account (but not to a donor advised fund).  Your gift will reduce your required  minimum distribution (RMD) up to the $100,000 IRA charitable donation limit.  You should make your charitable donation from your IRA first, before taking the remainder, if any, of your RMD.

Donor Advised Funds.   

The advantage of a donor advised fund is that you can get the deduction for making the charitable gift this year, deciding later to which charities you want to donate the money.

It is not too late to set up a donor advised fund for 2019.  Strategic Wealth Planning is available to help you set up a donor advised fund with a local charitable foundation such as Communities Foundation of Texas, Dallas Jewish Community Foundation, The Dallas Foundation, North Texas Community Foundation and Dallas Women’s Foundation, or a large investment firm that offers these services.

Private Family Foundations.    

As with all private foundations, family foundations must disperse at least five percent of assets every year.


 In 2019, you can gift up $15,000 to an individual (child, grandchild, friend, other relative) without filing a Federal gift tax return. The one exception is your spouse to whom you can gift any amount. The deadline for gifting is December 31. The mailbox rule does not apply.  So, if you give money to your children or grandchildren, you need the recipient to cash a gift check before the end of the year in order to count the gift in 2019.



If you have any questions, please give us a call.; we will be happy to discuss them with you.


Disclaimer:  the contents in this blog post are provided as a courtesy to our clients and other email recipients for informational purposes only.  The contents do not constitute tax, planning or legal advice.

[1] In 2019, the standard deduction is $12,200 for individuals and $24,400 for married couples filing jointly.