As we move into December, we want to share some gifting strategies for our clients who enjoy gifting to individuals or non-profit organizations.
In the video below, Austin and Steve discuss two common options, but there are many others available as well.
If you have any questions, please reach out to us here, or give us a call at 615.370.4040. We'd love to talk with you further and help wherever we can.
“Two of the most common strategies that we want to talk about today is the annual exclusion that you can gift person to person, and then how establishing a Donor-Advised Fund can really make a big difference.”
Transcript:
- Steve Alverson, CFP®: Well, Austin we're nearing the end of the year and a lot of times we get questions about gifting. What are some of the more common gifting strategies that we see?
- Austin Coley: Yeah, especially now that we're into December, we find a lot of clients who want to do some gifting before the end of the year. I think the first thing to understand about gifting is that there are a lot of different strategies. Steve, you as a CFP®, Barry as a CFP® and me passing my exam and a candidate for the CFP® now, we can help you with whatever goals that you have, and achieve those through gifting. Two of the most common strategies that we want to talk about today is the annual exclusion that you can gift person to person, and then how establishing a Donor-Advised Fund can really make a big difference if you wanna give that way.
As far as the annual exclusion is concerned, under current tax law, you can gift $15,000 from yourself to another person, and you can do that to as many people as you'd like.
-Steve: So what about a husband and wife? They would like to give to their child. Is that exact exclusive the $15,000 to the child or can the other spouse do the same?
-Austin: Yeah, good question. The answer to that is you and your spouse can each give $15,000 to that person. So for instance, if you had a child, you could give $15,000 and your wife could give $15,000 to your child, and you could do that for each child you have, or anybody else you wanted to gift to. The same also goes for a 529 account, if you'd like to do that. There are a couple other regulations on the back end of that, but again, if you'd like to do something like that, we can talk more.
The second gifting option that we've seen become more and more common over the last couple of years is a Donor-Advised Fund. What a Donor-advised fund is, the best way to think about it as your own Private foundation. There are a couple of differences between a Donor-Advised Fund and a Private foundation, but in its simplicity, it's setting up a fund that you gift to, and that money continues to grow in a Raymond James account here with us, that we help you manage. When you have a gifting desire, if you wanna give to your church, if you wanna give to a charity, something like that, you can actually gift it out of that fund while reaping the tax benefits of it today. It's very inexpensive to set up, which is another reason why we found it's more and more common as a gifting strategy that our clients have used.
The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee that it is accurate or complete, it is not a statement of all available data necessary for making an investment decision, and it does not constitute a recommendation. Any opinions are those of Barry McCall and not necessarily those of Raymond James.
Past performance may not be indicative of future results. All investments are subject to risk. There is no assurance that any investment strategy will be successful. While we are familiar with the tax provisions of the issues presented herin, as Financial Advisors of RJFS, we are not qualified to render advice on tax or legal matters. You should discuss tax or legal matters with the appropriate professional.