Donor-advised funds, Stock Donations and IRA Distribution

If you have a Donor-Advised Fund, it’s time to invest in For Pete’s Sake Cancer Respite Foundation! A Donor-Advised Fund, or DAF, allows you as a donor to receive an immediate tax deduction and then recommend grants from the fund over time. If you have a DAF, you can contribute to the fund as frequently as you would like and recommend grants to FPS when it makes sense! You become a “donor advisor” and retain advisory privileges over the investment allocation for the DAF.

Donations from a DAF can be made to any charitable organizations that are listed as tax-exempt under Internal Revenue Code (IRC) Section 501(c)(3) and public charities under IRS Section 509(a). Grants can also be made to private operating foundations or state or local government organizations qualified to receive tax-deductible charitable contributions. Please utilize the form provided to your right for your ease of use to allocate your DAF to invest in FPS!

The inclusion of an expanded charitable giving incentive is a critical acknowledgment by Congress that the work of nonprofits like For Pete’s Sake Cancer Respite Foundation are essential services. Cancer doesn’t take a break, and neither will we. This is the first time Congress has passed this type of giving incentive!

New Deduction Available: The bill makes a new deduction available for up to $300 per taxpayer ($600 for a married couple) in annual charitable contributions. This is beneficial for those taxpayers who do not itemize their deductions. It can be calculated by subtracting the amount of the donation from your gross income. It can be considered an “above the line” adjustment to income that will reduce your AGI, and reduce taxable income.

To qualify, you would have to donate to a qualified charity like For Pete’s Sake. If you have already made your donation since January 1, that contribution counts toward the $300 cap. A gift to a donor-advised fund (DAF) does not qualify for this new deduction.

New Charitable Deduction Limits: Individuals and corporations that itemize have the ability to deduct more significant amounts of their contributions. Individuals can elect to deduct cash contributions, up to 100% of their 2020 adjusted gross income, on itemized 2020 tax returns. This is a 40% increase from the previous limit of 60%. Corporations may now deduct up to 15% more of their taxable income at 25%.

The new deduction is only applicable for cash gifts that go to a public charity. If you give cash to a private foundation, the old deduction rules apply. While the organizations that manage DAF’s are public charities, you do not get the higher deduction for donating cash to your DAF. These new limits do not apply to gifts of appreciated stock.

If your assets are substantial enough that you can give more than your income this year, you won’t lose the deduction for the excess amount. You can use it the following year.

Required minimum distributions waived in 2020 for most donors: RMD for individuals over age 70 ½ is suspended until 2021. This includes distributions from defined benefit pension plans and 457 plans. The RMD is a great way for donors to make a significant charitable gift directly from their IRA to a charity through a qualified charitable contribution (QCD) while avoiding taxable income. The suspension of the RMD may dampen somewhat the incentive for a donor who makes a gift from their IRA to count toward that minimum. However, the tax benefit of the QCD remains.

Donors directing a QCD to charity this year (up to $100,000 per individual) will still reduce their taxable IRA balance. This allows all taxpayers, itemizers and non-itemizers alike, to direct gifts from their IRA to charities in a tax-efficient manner. 

To make appreciated securities and stock transfers simple, we are sharing below our account information for your financial advisor’s use. Some of our initiatives have restricted program gifts, so if this is an interest to you, please contact Danielle Coyne  at danielle@takeabreakfromancer.org so you can discuss your intent.

Stock Donation Instructions

FPS maintains an account with Charles Schwab & Co., Inc. To ensure we are able to match your gift to you and send you a receipt, please email Danielle Coyne at danielle@takeabreakfromcancer.org with the following information upon initiation of your stock transfer:

1. Name of Stock Owner
2. Name of Stock Transferred
3. Number of Share Transferred
4. Anticipated Date of Transfer

The following information is needed for your stock transfer:

Financial Institution: Charles Schwab & Co., Inc. DTC Number: 0164, Code 40 FFC: For Pete’s Sake Cancer Respite Foundation Account #: 6229-2377

For Pete’s Sake Cancer Respite Foundation qualifies as a charitable organization eligible to receive a Qualified Charitable Distribution (QCD).  The QCD allows you to make a charitable donation via a direct transfer from your IRA.  Making a QCD is as simple as contacting your investment advisor and instructing them to transfer your Required Minimum Distribution (RMD) directly to For Pete’s Sake Cancer Respite Foundation.

You can also go to our donation page and select “BANK ACCOUNT” to directly donate your QCD to For Pete’s Sake Cancer Respite Foundation.

If you have any questions about the above methods of giving, please call our office at 267-708-0510 or email info@takeabreakfromcancer.org.