Maximizing tax benefits with DAFs

Ambassador Advisors’ partnership with Faithful Journey Foundation (FJF) has been significant for our clients who desire to be good stewards of their assets.

The mission of FJF – “to empower Christian families and ministries to financially impact the kingdom of God” – is a testament to the prioritization of Biblically Responsible Investing and formative financial change, so that the causes you invest in align with your most important personal values.

FJF’s screening process eliminates companies that may conflict with your morals by supporting practices such as pornography, abortion, or human rights violations. This intentional screening provides you with peace of mind and the knowledge that your resources are not contributing to societally harmful practices.

A key part of stewardship and BRI is understanding how to contribute to the causes you care about and to donate with a tax-wise strategy that saves money in the long run.

Some clients opt to support their favorite charities through donor advised funds (DAFs), which allow for flexibility of contributions and tax-wise giving options. There are many options for giving to a DAF, such as:

1. Cash
2. Real estate
3. Publicly traded stocks
4. Cryptocurrency
5. Mutual funds
6. Bonds
7. Privately-held business interests
8. Rights to oil, gas, or minerals

Non-cash donations are quickly growing in popularity amongst those who hold DAFs, according to National Philanthropic Trust. Cash and non-cash options may be eligible for tax deductions right away and those charitable assets can then grow tax free in the DAF.

A long-term appreciated asset that has been held for longer than one year may be the most tax-savvy contribution. This is because those long-term appreciated assets can receive a tax deduction for their full-market value, while also eliminating any potential to realize gains on their sale.

Another way to maximize charitable giving and reap potential tax benefits is to bunch DAF donations. With new standard deduction rules, many donors are not able to itemize deductions. By combining multiple years of annual donations into one, many clients can once again itemize and secure maximum tax benefits.

DAFs can be incredible vehicles for charitable giving and receiving tax benefits that otherwise wouldn’t have been possible. Allow Ambassador Advisors and the Faithful Journey Foundation to help you maximize your giving toward causes you cherish.

Any opinions expressed in this forum are not the opinion or view of American Portfolios Financial Services, Inc. (APFS) or American Portfolios Advisors, Inc.(APA) and have not been reviewed by the firm for completeness or accuracy. These opinions are subject to change at any time without notice. Any comments or postings are provided for informational purposes only and do not constitute an offer or a recommendation to buy or sell securities or other financial instruments. Readers should conduct their own review and exercise judgment prior to investing. Investments are not guaranteed, involve risk and may result in a loss of principal. Past performance does not guarantee future results. Investments are not suitable for all types of investors. To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purposes of avoiding penalties that may be imposed by law. Each tax payer should seek tax, legal or accounting advice from a tax professional based on his/her individual circumstances.
This material is for informational purposes only. Neither APFS nor its Representatives provide tax, legal or accounting advice. Please consult your own tax, legal or accounting professional before making any decisions. Information has been obtained from sources believed to be reliable and are subject to change without notification. The information presented is provided for informational purposes only and not to be construed as a recommendation or solicitation. Investors must make their own determination as to the appropriateness of an investment or strategy based on their specific investment objectives, financial status and risk tolerance. Past performance is not an indication of future results. Investments involve risk and the possible loss of principal.