Qualified charitable distribution from an IRA. “Clients who have IRAs and are age 70½ can take a qualified charitable distribution from their IRA,” Rosen says. “This means that instead of receiving their mandatory taxable distribution, the money goes directly to charity.”
Foss says up to $100,000 of charitable contributions will offset the taxability of their required minimum distributions dollar for dollar.
Elsewhere, Seltzer recommends donating appreciated stock. “This allows you to get the deduction while avoiding the capital gains,” he says. “This is a much more efficient way of contributing compared with selling the stock and then making the donation in cash.”
“One misconception is that if you’re using the enhanced standard deduction, you get no benefit from charitable contributions,” Foss says. “Although federal taxes greatly exceed state income taxes, charitable contributions are still deductible on most state income tax returns.”
Your high-net-worth client may be inclined to make donations regardless of tax reform. “I’ve read that many people feel that charitable giving will go down,” Foss says. “But I don’t think the tax change will have a significant effect. People who are interested in charitable giving appreciate the charitable deduction, but it’s not a primary motivation.”