It’s the Most Wonderful Time (And Timing is Everything)

By December 18, 2014Blog

Roughly 25-30% of all household giving happens between Thanksgiving and New Years Eve according to recent studies by both Network for Good and the University of Indiana Lilly Family School of Philanthropy. Further, Network for Good noted that in both 2012 and 2013, 10% of all donations were made on the last 3 days of the year.

With that amount of activity happening in such a short, time-sensitive and time-strained time frame, it’s important to make sure your donors understand certain gifts may require some lead time beyond three days.

In order to secure an allowable charitable income tax deduction for 2014 gifts, donors should be aware of these IRS requirements for year-end gifts:

  • Check—make sure their envelope is postmarked no later than December 31st.
  • Credit Card—make their online donation before midnight December 31st.
  • Stocks & Mutual Funds (in a brokerage account)—start by December 12th to allow enough time for the transfer of ownership to occur. They’ll need to provide their broker or investment professional with a Letter of Instruction authorizing the transfer of the securities from their name into the name of your charity.
  • Stock Certificates (yes, these do still exist!)—must deliver to your “hand” anytime before December 31st or be mailed—postmarked no later than December 31st.
  • Special Assets (privately held company stock, LLC interests and real estate)—start now!
  • Private Foundation—must be incorporated, must secure an EIN (the IRS typically stops issuing EIN numbers just after Christmas), and must open a bank or brokerage account and allow time for funding to be complete before the 31st—start now!

Don’t forget to offer your donors the opportunity for Memorials and Honorariums—it can be their gift for the person on their list who has everything. Also, remind your donors not to leave money on the table if their employer offers a relevant Matching Gift Program.

I’ve always enjoyed this time of year. I enjoy all the holidays, and I enjoy the bustle of helping donors complete their year-end gifts. If I can be of assistance to you or your donors, please reach out.

David Baker

Author David Baker

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