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Big Gifts, Bullish Portfolios, and Kids Who Move Away: A Guide for Professional Advisors

As a professional advisor, we know you’re constantly seeking ways to enhance your services and provide valuable insights to your high net-worth clients. In 2024, one topic that should be on your radar is charitable giving. Recent studies even reveal that a staggering 85.1% of affluent households actively contribute to charitable causes, and many of your clients likely fall into this category.

In the coming months, take a few moments to examine your client list, and you’ll likely encounter three common scenarios that present exciting opportunities for charitable giving solutions.

Clients Who Made Significant Year-End Charitable Gifts

Chances are, you’ve had clients who generously increased their charitable giving at the end of 2023. Perhaps you assisted a client in establishing a donor-advised fund or another charitable fund at the community foundation or even helped a client structure a Qualified Charitable Distribution. Now, as the dust settles on year-end planning, it’s the perfect time to engage these clients in a conversation about their broader philanthropic intentions.

You might discover that these clients are interested in updating their estate plans to include a bequest to their fund at the community foundation or wish to create a charitable remainder trust using highly appreciated stock. Proactively planning charitable gifts for 2024 can also be a strategic move to optimize tax benefits. Encourage your clients to explore these possibilities to align their financial goals with their charitable aspirations.

Clients with Soaring Stock Portfolios

The year 2023 witnessed remarkable success and record highs in the stock market. For your clients, especially those holding long-term stock positions that have significantly appreciated, there’s a golden opportunity to employ an effective tax strategy—donating appreciated, publicly-traded stock to charitable organizations.

By facilitating the transfer of these marketable securities to a fund at the community foundation or another public charity, your clients can avoid capital gains tax. They also become eligible for an income tax deduction at the fair market value of the securities. Additionally, when the charity sells the securities, there are no capital gains taxes to worry about. It’s a win-win situation for both your clients and the charitable causes they support. Scan your client list for those who may benefit from this tax-savvy approach, particularly given the recent market rally.

Clients Whose Children Have Relocated

Affluent parents often find that their children move away for various reasons, and more often than their less-wealthy counterparts. This dynamic can present a unique challenge: staying connected with grown children who live in different locations. Here’s where the flexibility of the community foundation’s tools comes into play.

While the community foundation is an excellent resource for maximizing the impact and tax benefits of local giving, it’s also remarkably geographically flexible. Your clients can use their donor-advised fund to support 501(c)(3) organizations across the country, including in the communities where their children now reside. By showing genuine interest in your clients’ charitable priorities, you not only strengthen your client relationships but also help your clients foster closer connections with their adult children.

Strengthen Charitable Giving with Your Local Community Foundation

This year offers an exciting opportunity for professional advisors to elevate their client services by incorporating discussions on charitable giving. By addressing these common scenarios and opportunities, you can guide your clients toward more effective and meaningful philanthropy. If you’re looking for further assistance or wish to explore these options with the Athens Area Community Foundation, please don’t hesitate to reach out. We are here to support you and your clients in making charitable giving simple and impactful. Together, we can strengthen our community’s philanthropic spirit for generations to come.