Rebeca Bibleheimer, OCF Senior Complex Gifts Officer, on Taxes and Charitable Giving in 2023

Watch this quick video to catch up on important developments for 2023, including charitable implications from the Legacy IRA act that was passed in December of 2022 as part of Secure Act 2.0.

Here's what you need to know about charitable planning and taxes in 2023.

The first thing we should talk about is the very exciting Legacy IRA act that was passed in December of 2022 as part of Secure Act 2.0.

This act is going to allow your clients and our donors to make a qualified charitable distribution one time in their lifetime up to fifty thousand dollars in order to fund a life income gift so different than qualified charitable distributions prior to 2023 where the donor was not allowed to retain a benefit. The donor here can retain a life income stream for themselves and or their spouse and it can be through a charitable gift annuity or through a charitable remainder trust.

In addition to that Secure Act 2.0 provision that was passed, we’re still having a lot of charitable giving benefits from the first secure act that was passed in 2019. Due to the change in rules around stretch IRAs we have really seen such an increase in volume of testamentary charitable remainder trust since that 2019 bill was passed.

A lot of advisors are interested in talking to their clients and having their clients talk to OCF, about creating a testamentary charitable remainder trust to receive that IRA at their passing as a way of continuing some tax deferral and getting some additional tax planning around that account. Even outside of the IRA accounts, we have seen a lot of increase in just testamentary charitable remainder trust activity in general as advisors become more aware of these amazing tools. We obviously are experiencing a lot of volatility and a lot of concern around the market and financial conditions. Charitable giving is still strong.

We continue to see appreciated assets coming as a very popular tool for giving. When we work with our donors and looking at their assets, a lot of them still have some very highly appreciated stock in their portfolios and it still makes a lot of sense to be giving from that stock.

We work with them often, when they have cash that they would make a charitable gift from — instead they can just put that into that portfolio account, buy the same stock and have the same portfolio the next day, but just have reduced the unrealized gain in that portfolio and made a really tax wise gift to charity. So that continues to be a really popular way for people to do charitable giving even with the market volatility we’ve been experiencing.

We’ve really seen an uptick in estate planning, so we continue to have a lot of conversations with the estate planning attorneys, working with their clients on their estates, who are involving OCF to help their clients with that charitable giving piece in 2023.

We really look forward to continuing to grow our relationships with you and your clients. My name is Rebecca Bibleheimer and I'm the senior complex gifts officer at Oregon Community Foundation.