‘Bloomberg Personal Finance’: Advice for Donors

The November issue of Bloomberg Personal Finance magazine features a collection of articles on philanthropy designed to help donors take advantage of a wide range of giving options.

Among the articles in the issue:

• Giving circles, which operate a lot like investment clubs, are growing in popularity. Donors pool their funds and work together to figure out how best to give the money away. To capitalize on the interest in these circles, many colleges and other nonprofit organizations are creating them and inviting donors to participate. But the magazine cautions donors to be careful in choosing a circle to join: “As with any charitable contribution, do some research before you write your check,” the magazine says. “If scam artists haven’t already noticed the growing popularity of giving circles, they soon will.”
• A primer on charitable gift annuities. Through annuities, donors make a gift, claim a tax deduction for their donation, and then get regular payments from the charity. One reason the annuities are popular, says the magazine, is that “your intentions don’t have to be as pure as Mother Teresa’s.” It adds: “After all, you get the quarterly income and, in addition, a tax break.”
• Tips on how to tailor giving strategies to align with changes in the tax code. Perhaps most important, says the magazine: “Keep in mind the centerpiece of the new tax law: lower tax brackets. You’ll save more if you give to your favorite charity sooner rather than later. Since tax rates drop in 2002, a deductible donation made before January 1 is worth more than one made next year. That’s a strategy both givers and receivers can profit from.”