It’s hard to believe another year is nearly over. As 2022 winds to a close this month, this article will be my last opportunity to try to give some final words of wisdom that could impact your 2022 giving. So here are my thoughts and observations.

December is a great time to give. Of course, the very best time to give is whenever the opportunity arises, but December is a good time to give because there are so many opportunities. Nonprofit organizations in our community are always doing great work to serve those in need, but they often go above and beyond the call of duty to make the holidays special for those they serve. Such extraordinary efforts include providing traditional Thanksgiving food and helping parents provide toys and gifts for children. These extraordinary efforts necessarily require extraordinary support. Fortunately, generosity is contagious and seems to swell in December to rise to meet the needs. Giving Tuesday is a nationwide movement born out of this natural upswell of generosity. Our own Smith County United Way promoted Giving Tuesday with their online Tyler Gives campaign which raised over $251,000 for the United Way and 26 other Smith County charities.

December also marks the last opportunity for calendar year tax filers to make tax deductible contributions. Gifting appreciated stock is a common strategy used by many donors to avoid capital gains taxes, even though the gains may be a little lower with the stock market still down for the year (the DOW was down about 6.5% through November). Avoiding unnecessary taxes and taking advantage of the tax deductibility of charitable gifts is not the primary consideration for giving, but it is a strong secondary consideration for many savvy donors who are trying to be good stewards with their financial resources. Regardless of the movements in the market over the past year, December 31 is a hard deadline that compels many donors to make the best financial decisions available at the time. We would all love to own assets that continually grew in value, but 2022 is one of those years that looks like it will end below where it started in January, but that is still well above values from two, five and ten years ago.

When it comes to tax planning, another year-end tip is to consider establishing a donor-advised fund to maximize and organize your giving. Donor advised funds (DAFs) allow donors to receive an immediate tax deduction in the year contributions are made to the DAF, and receive an unlimited amount of time to make distributions to public charities from the fund. A common strategy using a DAF is to contribute appreciated stock to a DAF which is equivalent in value to two to three years of your anticipated charitable giving. By stacking multiple years of giving together, many donors can receive a higher tax deduction by itemizing their deductions in the year of the contributions, then taking the standard deduction for each year in which they are not itemizing. By setting funds aside in a DAF, you can respond quickly to charitable needs as they arise in the future. We are literally working with multiple clients each week this month who have been encouraged to employ this strategy by their tax advisors. Give us a call and see if this strategy is right for you. DAFs are quick and easy to set up, and our staff at East Texas Communities Foundation would welcome the opportunity to become part of your team to help you reach your charitable giving goals for 2022 and beyond.

My last piece of advice for the end of 2022 is to follow your heart, even if it is not deductible. There are many opportunities for giving in December and throughout the year to qualifying public charities for which you will receive a sincere and prompt acknowledgement for your contribution that you can use for tax purposes. However, there may also be opportunities to provide assistance, shelter, clothing, food or gifts to people for which you will not receive a tax receipt. My advice is to give as you can, when you can, and don’t worry if you can’t take a deduction for your generosity. You are welcome to contact our staff or your trusted advisor to discuss whether a particular giving opportunity qualifies for tax deductibility, but don’t let tax advice squelch the urging in your heart to help someone in need. Giving is top of mind for may people in December for a variety of reasons. Perhaps making a gift to a favorite local charity, extending a hand to someone in need or setting up a donor-advised fund are your next best opportunities to Give Well in 2022.

— Guest columnist, Kyle Penney is President of East Texas Communities Foundation and a Chartered Advisor in Philanthropy. To learn more about ETCF or to discuss your charitable giving, contact Kyle at 866-533-3823 or email questions or comments to etcf@etcf.org. More information is available at www.etcf.org.