SOMA Living November 2024

FINANCIAL FOCUS As we enter the annual season of giving, consider how to support charities while gaining tax benefits. Traditionally, you wrote a check to a charity and deducted the amount from your taxes. However, recent tax law changes significantly raised the standard deduction, leading to fewer people itemizing deductions and reducing financial incentives for charitable gifts. • Bunch your charitable gifts: Combine several years’ worth of gifts into one year. This approach may help you exceed the standard deduction and allow itemizing for that year. In subsequent years, you can revert to the standard deduction. • Make qualified charitable distributions (QCDs): After turning 73 (or 75 if born in 1960 or later), you must start taking withdrawals from your traditional or inherited IRA, known as required minimum distributions (RMDs). These withdrawals are taxable and could push you into a higher tax bracket. Donating RMDs directly to a qualified charity allows you to avoid taxes. You can start making QCDs at 70½, even before RMDs begin. • Consider a donor-advised fund: This arrangement allows you to contribute various assets and direct grants to chosen charities. You receive an immediate tax deduction for your contribution and avoid capital gains taxes. Consult your tax advisor before taking action on these strategies. You can still enjoy some tax advantages with smart strategies:

S.O. Jewelry Sale

Friends of South Orange Public Library Jewelry Sale!

Sat. Nov 16 - 10a-5p • Sun. Nov 17 - 1p-4p Baird Community Center • South Orange

Gary T. Jones 973.821.4900 • g.jones@EdwardJones.com

With over 25 years of experience, I work with individuals and businesses to help you achieve your financial goals. As a longtime resident of SOMA, I am proud to serve the local community. To learn more about the content of this article or schedule an appointment to talk about your goals, please contact me in my Maplewood office.

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