Giving, but with smarts

Giving, but with smarts

I was taught growing up that if you’ve been blessed with good fortune that you need to give back. I have been fortunate in life and so I’ve tried to live up to this teaching by providing assistance to many organizations such as the Rockland Jewish Community Campus, Good Samaritan Hospital, JEP of Rockland’s Hebrew School, Meals on Wheels adult day care program and Penguin Rep Theatre, among others. These local organizations have, in turn, done much good to make our community a better place.

As the year comes to a close we begin to think about giving, not just because of seasonal customs, but also because of the benefits we’ll see when we do our taxes. This year, there are more reasons than ever to pay attention to this aspect of our giving. As I write this, we have only a few weeks left for Congress to act regarding what are known as the Bush Tax Cuts. If absolutely nothing is done in the next few weeks, these tax benefits will expire and possibly many of the tax benefits wrapped up in charitable giving. Even if Congress does act, almost certainly the tax laws will change about how much the wealthiest Americans will be able to claim in tax deductions, possibly as early as next year.

So with that in mind, everyone should take a little time to think about their year-end giving. And if I’m going to put my two cents in, I’d suggest establishing a donor advised fund before we ring in 2013. You do not have to have an extravagant amount of money to start one, and it provides tangible tax benefits now, while enabling you to make donations well into the future, untouched by the tax changes.

And if I were going to give another two cents about which fund to use, I would recommend the Jewish Communal Fund. I’ve been using it for many years and find it an extremely efficient way to make charitable donations. The Jewish Communal Fund provides easy access to information I need and it is a smart and effective way of giving. And while you can give to any qualified charity, in my opinion the fund has a Jewish soul to it.

The way it works is quite simple: With as little as $5,000 you can set up a fund today for which you will get a tax deduction on your 2012 tax return. Over time, you tell the fund managers what kind of grants you wish to make and to which qualified non-profit organizations.

You determine whether the funds are placed in a money market, fixed income or managed equity fund, or in privately managed investment accounts. And now, for the first time, you can also invest them in short-term Israel Bonds, so you are not only doing some good through charitable giving, but also through some savvy investing in the State of Israel. The income that accrues from the investments belongs to the Jewish Communal Fund, which is distributed to qualified charitable organizations of your choice and at your recommendation. You are not taxed on that income, nor are you eligible for further charitable deductions on that money.

Once you establish your fund, you, or anyone else, can continue to add to it at any time in any amount. So for example, if you are having a milestone birthday, and instead of gifts you wish people to make a donation on your behalf, you can direct them to your donor advised fund with JCF.

Funds can be supplemented at any time by check or credit card, through the transfer of bonds or mutual fund shares, and certain types of stock or other assets. There are some small fees associated with maintaining the fund annually. And once a year, the Jewish Communal Fund board of trustees disburses funds from its management fees.

There are a variety of funds you can establish, including a general charitable fund, wedding funds and group funds that can be set up with an initial contribution of $5,000. Bar and bat mitzvah funds, NextGen giving and children’s funds can be set up with as little as $1,800. And deferred funds allow you to leave a legacy, something that will continue giving after you die.

Major changes are expected as Congress prepares to deal with the fiscal cliff. How and what we give will be impacted greatly by any of the forthcoming tax proposals currently being considered should they become law. With all the uncertainty, one thing is for sure: Setting up a donor advised fund now will save you money on your taxes, while letting you support the organizations and agencies you care about in the future. Even if the tax code does not change in the near term, this is just good, smart giving.

Of course, every person’s situation is unique, and before you make any changes you should consult your financial planner or an accountant. But while you are in the mood of seasonal giving, check out the Jewish Communal Fund. They are online at or you can call (866) 580-4523.

And when you do, don’t forget to tell them that Barry sent you.

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