This may be the biggest year in history for American philanthropy, Kim Laughton, president of Schwab Charitable, said in a statement this week on the release the donor-advised-fund sponsor’s 2017 giving report.
Laughton pointed to three factors she said advisors should discuss with their clients about why now is an ideal time to embrace charitable giving.
One is the improving economy and strong market performance. She noted that the S&P 500 has risen by 80% in the last five years, and because of healthy investment gains, many investors now face higher tax bills.
Donors who contribute appreciated assets they have held for more than one year to charity can help offset these taxes and increase charitable giving by as much as 20%, she said.
Another factor is possible tax reform legislation. Laughton said the value of charitable deductions increased in 2013 when income tax and capital gains tax rates went up for most high-income earners.
Although the itemized charitable deduction will likely be protected in some way in legislation resulting from the current tax-reform push, she said, any reduction in income or capital gains tax rates could lower the value of charitable deductions.
Finally, there is the huge level of disaster relief support needed across the U.S. In the past few months, hundreds of thousands of people have been hit by hurricanes, floods and fires, and are in desperate need of food, emergency shelter, clean water, electricity and access to critical medical care.
Laughton said that as of the beginning of October, Schwab Charitable donors had recommended upward of $12 million in grants for hurricane and earthquake relief, and this number continued to grow.
2017 Giving Report
Here are some highlights from Schwab Charitable’s latest giving report.