charity - Linkenheimer LLP CPAs & Advisors

Boost Your Tax Savings by Donating Appreciated Stock Instead of Cash

Saving taxes probably isn’t your primary reason for supporting your favorite charities. But tax deductions can be a valuable added benefit. If you donate long-term appreciated stock, you potentially can save even more.

Not just a deduction

Appreciated publicly traded stock you’ve held more than one year is long-term capital gains property. If you donate it to a qualified charity, you may be able to enjoy two tax benefits.

First, if you itemize deductions, you can claim a charitable deduction equal to the stock’s fair market value. Second, you won’t be subject to the capital gains tax you’d owe if you sold the stock.

Donating appreciated stock can be especially beneficial to taxpayers facing the 3.8% net investment income tax (NIIT) or the top 20% long-term capital gains rate this year.

The strategy in action

Let’s say you donate $15,000 of stock that you paid $5,000 for, your ordinary-income tax rate is 37% and your long-term capital gains rate is 20%. Let’s also say you itemize deductions.

If you sold the stock, you’d pay $2,000 in tax on the $10,000 gain. If you were also subject to the 3.8% NIIT, you’d pay another $380 in NIIT.

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By Linkenheimer LLP|2025-10-14T15:37:56+00:00October 14th, 2025|capital gains, charity, deductions, tax planning|0 Comments

Tax Court Denies Charitable Contribution Deduction for Lack of Substantiation

Why Your Charitable Receipts Need More Than Just a Signature

When was the last time you actually read the receipt from that donation drop-off? If you’re like most folks, you probably grabbed it and called it a day. Well, John Henry Besaw’s recent Tax Court case (TC Summary Opinion 2025-7) might make you think twice about that approach.

Besaw claimed $6,760 in noncash charitable contributions on his 2019 return, attaching Form 8283 with donee names and general descriptions – but crucially, no dates or values for the donated items. When the IRS disallowed the deduction for insufficient substantiation, Besaw scrambled. He provided receipts, but they were blank regarding specific item descriptions and values. He even submitted non-contemporaneous “reconstructed” documents detailing his donations. Special Trial Judge Leyden wasn’t impressed, noting that Treasury Regulation 1.170A-13 mandates receipts must include “a reasonably sufficient description of the donated property.” The Court ruled in favor of the IRS, upholding the disallowance of the entire deduction (though Besaw dodged accuracy-related penalties under IRC Section 6662(a) – small victories, right?).

How to Stay Out of Trouble

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By Linkenheimer LLP|2025-07-29T16:12:52+00:00July 29th, 2025|charity, deduction, deductions|0 Comments

End-of-Year Tax Strategies: Gifting and Charitable Giving

As the year draws to a close, it’s the perfect time to review your financial and tax strategies. Whether you’re looking to benefit loved ones or support charitable causes, there are several ways to make tax-efficient financial decisions before December 31. This guide highlights two key strategies: annual exclusion gifts to reduce your taxable estate and qualified charitable distributions (QCDs) to maximize the tax benefits of your charitable contributions.

Annual Exclusion Gifts

As the end of the year approaches, many people start to think about their finances and tax strategies. One effective way to reduce potential estate taxes and show generosity to loved ones is by giving cash gifts before December 31. Under tax law, you can gift a certain amount each year without incurring gift taxes or requiring a gift tax return. Taking advantage of this rule can help you reduce the size of your taxable estate while benefiting your family and friends.

Taxpayers can transfer substantial amounts, free of gift taxes, to their children or other recipients each year through the proper use of the annual exclusion. The exclusion amount is adjusted for inflation annually, and in 2024 is $18,000. It covers […]

By Linkenheimer LLP|2024-11-18T19:24:34+00:00November 18th, 2024|charity, contributions, gift tax, year-end|0 Comments

If You Gave to Charity in 2023, Check to See That You Have Substantiation

Did you donate to charity last year? Acknowledgment letters from the charities you gave to may have already shown up in your mailbox. But if you don’t receive such a letter, can you still claim a deduction for the gift on your 2023 income tax return? It depends.

What the law requires

To prove a charitable donation for which you claim a tax deduction, you must comply with IRS substantiation requirements. For a donation of $250 or more, this includes obtaining a contemporaneous written acknowledgment from the charitable organization stating the amount of the donation, whether you received any goods or services in consideration for the donation and the value of any such goods or services.

“Contemporaneous” means the earlier of:

The date you file your tax return, or
The extended due date of your return.

Therefore, if you made a donation in 2023 but haven’t yet received substantiation from the charity, it’s not too late — as long as you haven’t filed your 2023 return. Contact the charity now and request a written acknowledgment.

Keep in mind that, if you made a cash gift of under $250 with a check or credit card, generally a canceled check, […]

By Linkenheimer LLP|2024-01-31T17:09:24+00:00January 31st, 2024|charity, tax planning|0 Comments

Join Us in Supporting a Great Cause: The Boys & Girls Club of Sonoma-Marin

Join us on October 15th from 12-4pm on the picturesque Healdsburg Plaza for a rare opportunity to celebrate crush with 60 of California’s best Pinot Noir and sparkling wine producers! We’re a proud sponsor of Healdsburg Crush! All proceeds will go to support the amazing programs at @BGCSonomaMarin. Tickets can be purchased at healdsburgcrush.com, use promo code LINK23 to get $15 off General Admission tickets. Cheers!

By Linkenheimer LLP|2023-09-01T20:29:39+00:00September 1st, 2023|charity|0 Comments