Insights from a pro: Ways to optimize your church’s year-end giving

Many people choose to make end-of-year donations through their IRAs or as gifts of stock as tax-deductible contributions to their churches. Here are some things to keep in mind.

Required Minimum Distributions are back in 2021

If you have reached age 72 and are required to take a minimum distribution (RMD) from your IRA, you can authorize gifts from your IRA directly to the church. You reduce your taxable income, and the distribution counts toward your RMD.

Required minimum distributions were put on hold in 2020 but are required again in 2021.

Due to the CARES Act, individuals who take the standard tax deduction can deduct up to $300 in charitable giving in 2021, and married couples who file joint returns can deduct up to $600. This is a significant change, as, before the CARES Act, taxpayers who took the standard deduction could not take any deductions for charitable gifts.

To qualify for the tax credit, you must have your retirement plan administrator direct the distribution DIRECTLY to your church; it cannot pass through your hands or it will trigger an income taxable event for you.

If you have questions about how to execute this gift transaction, please contact Susan Cothern at 888-450-1956, ext. 1507 or SCothern@umfwnc.org and she will be happy to help you through the process.

Gifting stock and appreciated securities

Gifts of stock are tax deductible just like cash gifts AND donors can avoid capital gains taxes by donating appreciated stock rather than selling it outright and then donating the proceeds. The result is a lower tax bill for the donor and more of the gift going directly to the church or ministry.

Watch the video above to hear from Rob Byrd, our Board Treasurer and a certified public accountant for more than 40 years. Rob shares insights for donors, clergy and church finance officers.

“As we get toward the end of the year, a lot of people like to take advantage of planning their charitable giving,” Rob said. “Many times, they want to accelerate it into the current year.”

If you have church members who wish to donate appreciated stock, the Foundation will liquidate these gifts for you AT NO COST! For assistance with a stock transfer, contact Andrea Gutierrez at 704-817-3990, ext. 1504 or AGutierrez@umfwnc.org.

We send the proceeds from most stock gifts as a check to a church for its unrestricted use. Additionally, some donors have asked us to apply their gifts toward:

Click here to visit the Donor Resources tab on our website, where you can download instructions for gifting stock with the Foundation. Please note that we ask all donors to provide a letter of instruction that indicates where gifts should be sent. Donors will receive an acknowledgement letter for their tax purposes after funds have been dispersed.

Click here for a print-ready brochure to inform church members about end-of-year giving, including IRAs and stock gifts.

Click here for details on a webinar series called Transformational Generosity launching in January.

All stock donations must be received no later than Dec. 31 to be considered a contribution for 2021.

Stories you may be interested in

How a 180-year-old church adapted to stay vital

Creative ministry has helped to sustain, and even grow, the congregation of First UMC in Asheboro at a time when many older downtown churches are struggling.

Read and watch >

Foundation welcomes Amanda Goedert

Amanda joins the staff as executive support specialist.

>

Foundation plans new initiatives for 2022

Blessed with a strong financial performance and the faith and trust of our partners, Foundation board members approved a 2022 budget that funds a number of church-building initiatives.

Learn more >