Dear friends of SWCF,
Though we’re well into the month of September, it doesn’t yet feel like fall in Dallas. Nonetheless, the end of the year is fast approaching!
This is the perfect time to think about a charitable gift of a non-cash asset. Depending on the nature of the asset, these gifts take longer to process, so it’s good to get a head start. The Federal Reserve recently reported that 81% of American wealth is held in assets such as stocks, bonds, retirement accounts, mutual funds, life insurance and real estate: types of assets referred to as “non-cash assets”.
Whether you’re a seasoned philanthropist or just getting started, one of the best opportunities to make an impact comes from selecting the best asset to give to charity. It can be second nature to immediately reach for your checkbook when you learn about a cause you want to support, but SWCF can help you maximize impact – for yourself AND the charity (ies) you love.
SWCF was honored to invite Dr. Russell James to speak at our 29th Annual Professional Advisors Seminar earlier this month. In 2018, Dr. James published a study, “Cash is not King in Fundraising”. After reviewing more than 1 million nonprofit tax returns, he found that nonprofit organizations consistently receiving gifts of stocks or bonds grew their contributions six times faster than those receiving only cash.
If you are like 81% of your fellow Americans, it’s likely that your financial resources are tied up in non-cash assets. Your team at SWCF may be able to help you amplify the tax-efficiency of your giving to use those types of assets to fund a donor advised fund, an endowment fund, or a scholarship fund. We regularly partner alongside professional advisors such as CPAs, Attorneys, and Wealth Managers to provide insight and develop strategies for maximizing impact.
Let’s use a hypothetical scenario to bring this strategy to life:
- Donor owns securities valued at $50,000
- Original cost of securities: $25,000
- Federal long-term capital gains rate: 15%
| Sell securities & donate after-tax proceeds | Donate securities directly to a donor-advised fund | |
| Fair market value of stock | $50,000 | $50,000 |
| Long-term capital gains tax (15%) | $3,750 | $0 |
| Amount of gift | $46,250 | $50,000 |
| Federal income tax savings | $16,180 | $17,500 |
*This hypothetical case study is provided for illustrative purposes only; it does not represent an actual donor but is meant to provide an example of how a donor-advised fund can help individuals give significantly more for the causes they care about. The information provided is general and educational in nature and should not be construed as legal or tax advice.
In the illustrative example above, the donor was able to give an additional $3,750 to charity and save more on Federal taxes using this relatively simple strategy. SWCF has made this even easier by partnering with DonateStock to process gifts of stock to charity. We’ll even cover the cost of your first stock gift to your fund at SWCF! Visit the DonateStock page to learn more about how this resource can be put to work for you and your financial advisor: Donate Stock To Charity – Accept Stock Donations | DonateStock
A similar formula to the above can be applied to other appreciated assets, beyond traditional stocks in your portfolio. We are frequently evaluating gifts of private equity partnership interests, long-term appreciated private company c- or s-corp stock, commercial real estate, and other complex assets. There are a number of important considerations that apply to these types of assets, including the potential/ease of liquidation, timing of the process, determining its fair market value, and transaction costs. It’s important to work with an experienced team of professionals, like ours at SWCF, to navigate this process so its fully compliant with current IRS regulations.
At SWCF, we love thinking through creative ways of helping people be more philanthropic. We’d be happy to sit down with you to discuss your specific situation as we enter the 4th quarter.
In addition to wrapping up the calendar year, I’m also celebrating my second anniversary as President and CEO of SWCF! What perfect timing to highlight some of our recent accomplishments:
- Record-breaking Grantmaking: In our fiscal year 2024, which represented our 50th year of operations, DJCF/SWCF fundholders directed a record $37 million to charities from funds held at the foundation. This is a 48% year-over-year increase in giving.
- Growth in Assets: Charitable assets under management grew by net $80 million to our current AUM of $360 million. We are nearly halfway to our $1 billion goal!!
- Rising the Charitable Tide for all Boats: Grew our custodial agency relationships to include 62 nonprofit organizations, based locally and nationally.
- Supporting Students: Surpassed $3 million in charitable support via scholarships awarded. Expanded our scholarship program to now offer 80 unique opportunities to support educational pathways from early childhood to advanced degrees, across a wide range of academic interests and eligibility.
- Innovating for Good: DJCF collaborates with Chariot and DonateStock to make it easier and more efficient to drive impact from your donor-advised funds and to make charitable gifts of stock.
- Expanded our Team: We’ve welcomed 3 new employees to the DJCF team – Sarah Golman, Chief Operating Officer, Brooke Bloomberg, Impact Associate, and Lisa Wile, Executive Assistant.
Behind each of these highlights was a yeoman’s job of professional and volunteer leadership and effort put forth by committee members and our Board of Trustees. It’s just a glimpse of the transformation that we’ve been driving since September 2022 – making this philanthropic community strong, vibrant, and sustainable. This professional opportunity is truly a dream come true for me, having the chance to impact lives and places for the better while working alongside my friends and talented, supportive, diverse community.
Thank you for the trust and confidence you place in us as your partner in philanthropy. It is the biggest gift.
Grant Cycle
Please note: With the Jewish holidays approaching, the grant cycle in the month of October will be slowed down. Below are some important dates to note when requesting grants in the month of October.
- Oct. 7: Grants close on Monday, checks will be mailed by Friday 10/11
- Oct. 14: Grants close on Monday, checks will be mailed following Monday 10/21
- Oct. 21: Grants close on Monday, checks will be mailed following Monday 10/28
- Oct. 28: Grants close on Monday, checks will be mailed by Friday 11/1
Investment Reports & Fund Statements
The Foundation’s investment portfolios managed by Graystone Consulting, under the guidance of the Foundation Investment Committee. This relationship has allowed us to offer seven investment models for our constituents to choose from. Graystone provides monthly investment return information on the models as a whole and fact cards for the individual models and the sub-funds that make up each model.
SWCF’s August investment performance reports are posted on the website. These reports can be found on the Investment Reports page under ‘Tools + Resources’ tab on our menu toggle, found here: Investment Reports – Southwest Community Foundation (southwestcf.org)
August fund holder statements can be found in your My SWCF portal.
Thank you for entrusting us with your generosity and for being an integral part of our foundation. Your support fuels our work and inspires us every day.
