Year-End Giving in a 2020 World

Share Post: facebook Created with Sketch. twitter Created with Sketch. linkedin Created with Sketch. mail Created with Sketch. print Created with Sketch.

By Nik Aamlid, Wealth Advisor

To say 2020 has brought on a unique set of challenges would be the understatement of the year. One principle I’ve always tried to live by when things seem out of control is just to do the next right thing. Not to think too far ahead, but just to control what I can control in that moment. A lot of times, that means taking the focus off of my situation and trying to help someone else. Philanthropic giving is a great way to support others and make an impact in the world. Giving is a decision that is often made for more than a planning purpose, but here are a few technical items to focus on at the end of 2020 if you find yourself in a position to make a difference in that capacity.


Take advantage of the CARES Act

As coronavirus entered the scene early, President Donald Trump signed the CARES Act into law on March 27th, 2020. This bill increased the limit for most tax-deductible charitable contributions from 60% to 100% of adjusted gross income for individuals. So, 2020 may be a year to consider a larger cash gift to organizations you have planned to support. In addition, the CARES Act added a $300 “above the line” deduction for those who do not itemize their taxes and make a charitable contribution in 2020.

Gift clumping

Speaking of taxes, in 2019, the standard deduction essentially doubled. It was forecasted this may negatively affect charitable giving in 2020, since there would be less tax incentive to give. That brought forth the idea of gift clumping where one would make two years’ worth of gifts during one calendar year as a way to push past the standard deduction and itemize their taxes. Combined with the changes from the CARES Act, 2020 could be a year to consider a gift clump.

Consider a donor-advised fund

A donor-advised fund (DAF) is like a charitable investment account. It allows the donor to make charitable contributions to the fund and receive an immediate tax deduction even if the funds are not distributed to charity until a later date. If gift clumping is a tool that may benefit your situation, a donor advised fund could be a consideration. You can place multiple years’ worth of gifts into the donor advised fund in one year and then gift from the fund to the charities of your choice in subsequent years.

Alternatives to cash giving

There are multiple ways to give outside of cash. These can be great planning tools in certain situations. Gifting RMD’s from a qualified account, and gifting appreciated stock are just two options. Due to the passage of the CARES Act earlier this year, you are not obligated to take your required minimum distributions (RMDs) in 2020. This poses a great situation for people that are used to taking those distributions, but don’t need the funds for income. If you typically gift RMD’s, but you want to leave the money in your qualified account and still want to do some gifting in 2020, you can turn to your non-qualified accounts. If you own stocks or other assets that have an appreciated value, you can gift shares directly to a charity. You don’t pay tax on the gains since you gifted them and the charity can sell the asset and not pay tax either.

So, if gifting is a passion and you have been on the fence about whether it makes sense to do anything in 2020 or not, just know there are some options to make the difference you desire to make and to still do it in an efficient manner.

If you want help strategizing your 2020 year-end giving, please, give us a call at (605) 271-6023 or visit to setup a complimentary, no obligation meeting.

This piece is not intended to provide specific legal, tax, or other professional advice. For a comprehensive review of your personal situation, always consult with a tax or legal advisor.

facebook Created with Sketch. twitter Created with Sketch. linkedin Created with Sketch. mail Created with Sketch. print Created with Sketch.
Share Post: facebook Created with Sketch. twitter Created with Sketch. linkedin Created with Sketch. mail Created with Sketch. print Created with Sketch.


4 Hurdles in Retirement Beyond Your Investment Portfolio

Becoming hyper-focused on only one aspect of a problem is pretty much never a good approach. A racecar driver who only focuses on speed and ignores strategy won’t win races, at least not many of them. A carpenter who only hammers in nails won’t build strong structures. 

Your Silicon Valley Bank Questions Answered

You likely have heard about the recent Silicon Valley Bank (SVB) collapse and probably have questions. Here, we provide you with unbiased answers to your questions.

Thinking About Retiring Early? 8 Things to Consider First

Tom Fridrich, JD, CLU, ChFC®, Senior Wealth Planner We’ve all asked ourselves whether it’s too early to retire (usually after a particularly challenging commute or dealing with a difficult client).  You may have even gone so far as to take a sneak peek at your account statements …

4 Tips to Take Your 401(k) to the Next Level

Matt Kory, Vice President, Retirement Programs As a retirement income vehicle, the 401(k) is second in popularity only to Social Security – and as CNBC reported in 2019 the number of 401(k) millionaires is at an all-time high. But is a million dollars even enough for your retirement needs? 

1 2 3 103 104 105

Get in Touch

In just 15 minutes we can get to know your situation, then connect you with an advisor committed to helping you pursue true wealth.

Schedule a Consultation

TweetsFollow Us