Learn about donor-advised funds and the benefits they offer.
How do donors benefit?
Franklin Charitable Giving Program offers many tax advantages. In addition to receiving an immediate tax deduction, you have the flexibility to designate grants whenever it best suits you and the convenience of being able to more easily track and plan charitable activities for future years.
Your contribution to the fund is an irrevocable charitable donation, fully deductible on the date it's received by the foundation, subject to any applicable limitations on charitable contributions. The extent of the deduction depends on the type of asset being contributed, as well as your particular tax situation.
Individuals should always consult their legal and tax advisors to discuss the personal circumstances regarding their income and estate taxes.
Cash contributions are eligible for a federal income tax deduction of up to 50% of adjusted gross income (AGI) in the tax year in which the contribution is made. If contributions exceed this limit, the deduction may be carried forward up to five years.
Publicly traded securities
For publicly traded securities held for more than one year, the amount of the deduction is the mean value of the high and low prices of the security on the date of the contribution. You may generally deduct up to 30% of your AGI for contributions of appreciated securities held more than one year.
For securities held for one year or less, the deduction is based on either your cost basis or fair market value, whichever is lower. If your contribution exceeds the 30% AGI limit, the deduction may be carried forward up to five years.
All contributions to Franklin Charitable Giving Program are separate from your estate and therefore are generally not subject to estate tax or probate.
Any income to your donor-advised fund account resulting from investment growth is neither taxed to the donor nor is deductible as an additional charitable contribution.
One of the most rewarding benefits of donor-advised funds is the ability to contribute appreciated assets without incurring capital gains tax liability.
Important Legal InformationThis discussion regarding the deductibility of charitable contributions is for general information only and is not tax advice. Individuals considering a contribution to Franklin Charitable Giving Program should consult their legal and tax advisors regarding deductions, based on their personal considerations.
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