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This month we seem to be getting a great deal of questions about giving to charity in a down market, and we’ve answered them in the newsletter below. If you have questions for next month, please send us a note!
- Should you change your gifting when the stock market is down? This is a matter of personal preference. If your financial plan allows you to, and you still wish to give a significant amount, it may make sense to give as you always have. However, if you are under pressure due to inflation, job loss, etc., it may be a good idea to rethink giving the full amount.
- If your portfolio declines, it’s possible that the tax benefit of gifting an appreciated position may be less than what it would be in an up market. It’s possible that with volatility some of your positions may not be standing at as much of a gain as they were before – or they may even be at a loss. As a reminder, when you gift an appreciated position to charity, you are not due to pay the tax on the capital gain, and the market value amount of the gift counts as a tax deduction in that calendar year. It’s best to analyze each position individually to determine the extent of the gain.
- In any market, it’s important to give wisely. Make sure to consult with resources such as CharityNavigator or GuideStar to find information about the charity’s leadership, mission, and financials. Above all, you want to make sure the organization is legit.
As always, please call or reach out over email with any questions.
-Judd