December 22, 2015

Charitable Giving Opportunities for Investors

Lake Michigan Investment Services

There’s a very distinct difference between simply supporting charities with monetary donations and incorporating that charitable giving into longer range investment strategies. Most charity donations are tax deductible (within limits) on your annual federal and state tax returns. But making gift giving part of your investment plan can compound your giving power while providing further tax incentives.

You’ll first need to evaluate a number of factors, like your need for current income, desire to control and preserve your assets during life and after death, specific charitable intent, as well as important tax management issues.

Donor-Advised Funds
A donor-advised fund is a tax-advantaged charitable giving vehicle that offers maximum flexibility. These funds are particularly family-friendly, allowing parents and children to consolidate their giving activities and preserve its legacy over the generations. These accounts also have the potential to grow over time, increasing the donor's giving power.

Family Foundations
A family foundation derives its assets from the members of a single family, in which the donors and relatives can play a significant role in managing the foundation. Family foundations can form a legacy of community involvement and responsible citizenship for generations to come.

Balance Giving Goals and Financial Planning
Charitable remainder trusts (CRTs) can guarantee a lifetime income stream for a donor and a spouse, while minimizing current income taxes. Charitable lead trusts (CLTs) provide control of a donor's assets during their lifetime, and provide a legacy to family heirs with potentially little or no estate tax consequences.

Including charitable giving strategies within your estate plan can be an effective way to enjoy an income stream during your life, earn tax savings, and maintain a significant degree of control over those assets.

Contact Lake Michigan Investment Services for a free, no-obligation financial analysis of your portfolio, and to help you identify the charitable gifting strategies most appropriate for your situation. Call us at (616) 234-6524, or go online to