Charitable Giving, Donations, Client Relations. SigWealth Partners

Guiding Clients Through End-of-Year Charitable Giving

When it comes to your clients, you want to be their one-stop source for guidance. Not only do you help with planning their futures, but also often with questions around other topics, including tax implications and potential charitable contributions. Heading toward the end of the year is an excellent time for clients to consider giving to charity, and it’s also a time of year when it is often the most needed. Charitable planning is an exceptional service to add to your resume. 

Whether an individual or a business, charitable giving is essential. According to the National Philanthropic Trust, about 90 percent of high-net-worth households give to charity, and corporate giving in 2018 increased by 5.4 percent to $20.05 billion. Foundation and corporate giving also increased in 2018. Not only is giving good for the community, but it is also a fantastic asset for your business. By being involved with your community, you can help connect with those locally who may consider becoming patrons of your business. This can be a great addition to your overall public relations and marketing strategy.

However, where do you start with your clients? This is a great time to discuss the consideration of charitable giving because there are advantages to prioritizing and organizing donations before the end of the year. 

Advantages to giving before the end of the year

Tax deductions

If you give before the end of the year, the donation will be tax-deductible for your upcoming taxes. This way, you won’t need to wait until the following year to claim donations on your taxes. You will be able to have access to this benefit in just a few months.

Helps organizations

Many organizations count on the charitable feelings people have toward the end of the year. Between Thanksgiving, Christmas, and the other holidays, people tend to feel more generous. Your clients will be helping an organization in need at the end of the year. The organization may be close to its goal, and the extra donation can help them in working toward their mission.

How to help your clients narrow down and prioritize their philanthropic goals

Determine their budget for giving

The first thing that you should work through with your clients is how much they have and are willing to give. You don’t want to commit to giving before knowing how much they will be able to offer. Outline the budget, any employees’ bonuses, and other expenses before diving into charitable contributions.

Determine how they want to give

There are more ways to donate than with money. While money is helpful for organizations, so are volunteers. Maybe your client likes a hands-on approach to giving back. You can suggest that they take a day out of work and volunteer with their employees at an organization that they favor. 

Volunteer opportunities are a great way to gain visibility in the community. Suggest that they take pictures and post stories on their website and social media as well. Sharing these experiences will help inspire other people and organizations to interact with them. It shows some of the heart behind the business.

Determine what matters to your clients

Most likely, your clients will already have some idea of which organizations they want to contribute to, assist them in making a list of the ones that most pique their interest. Next, ask them which one is the most important. Which one do they absolutely want to contribute to, and why? Then, rank the rest. Make sure that the gifts are going to a qualified organization. The IRS definition includes churches, temples, synagogues, governments, and mosques. Check out the Exempt Organizations Select Check Tool on the IRS website. Take any off the list that don’t qualify.

After you’ve determined which organizations they are going to contribute money to and which they are going to volunteer at, you can go back and look at the budget.

Divide up the money

The maximum deduction is 50 percent of adjusted gross income. Make sure to consider this when dividing up the money to be donated. Work closely with your clients to make sure you understand which organizations they want to contribute to and why.

Maintain the proper paperwork

Make sure your clients understand how vital recordkeeping is when giving donations. If contributing in cash, your client needs to have a record that has the amount of money given, the name of the organization, and the date it was given.

Working with your clients to determine a giving year-end planning strategy is key for their sales and can help a great deal with their long-term success. It’s a great time of year to give back because they will know exactly how much is left in their budget. Not only is it a financial strategy, but it is also a marketing strategy that can help them connect with their target audience.

Opinions expressed are those of Signature Wealth Partners. All opinions are as of this date and are subject to change without notice. The information has been obtained from sources considered to be reliable, but we do not guarantee that the foregoing material is accurate or complete.