With the year drawing to a close, you might be reflecting on how you can make a meaningful impact with your charitable gifts.
Fortunately, there are various strategic ways to give that not only support the causes you’re passionate about, but also offer significant tax benefits.
The following options below can help you make the most of your year-end contributions, especially if you’re working with a financial advisor or planning to make a charitable contribution from your IRA or Donor-Advised Fund (DAF).
Giving Through Your IRA: Harnessing the Power
One of the most tax-efficient ways for you to support Kansas City Ballet is through a Qualified Charitable Distribution (QCD) from your Individual Retirement Account (IRA).
If you’re 70½ or older, you can donate directly from your IRA to Kansas City Ballet or any other qualified charity. The key benefit is that your donation counts toward your required minimum distribution (RMD) for the year, and it is excluded from your taxable income. This can lower your overall tax liability, which is especially beneficial if you’re in a higher tax bracket. Additionally, by making a direct transfer from your IRA, you can avoid paying income tax on the distribution—helping you make the most of your gift.
Donor-Advised Funds: Simplifying Charitable Giving
Another strategic way for you to give to the charities you support is through a Donor-Advised Fund (DAF). A DAF allows you to make a charitable contribution, receive an immediate tax deduction, and then recommend grants over time.
For example, if you contribute appreciated assets such as stock or mutual funds to your DAF, you receive a charitable deduction based on the fair market value of the asset. When you later make your gift from the DAF to Kansas City Ballet, you avoid capital gains taxes on the appreciated value.
A DAF is a great tool if you want to streamline your giving over several years. You can establish a DAF in advance of a major gift and then decide later when and where to direct those funds—whether it’s to support specific Kansas City Ballet programs, performances, or general operations.
Estate Giving: Creating a Lasting Legacy
If you’re thinking about how to make a significant charitable gift that will last beyond your lifetime, including Kansas City Ballet in your estate plan can provide substantial benefits for both you and your beneficiaries.
One of the simplest ways for you to make an estate gift is by designating a charity as a beneficiary of certain assets. Common assets that can be given through beneficiary designation include:
- Retirement accounts (IRA, 401(k))
- Life insurance policies
- Bank accounts or brokerage accounts
By naming Kansas City Ballet as a beneficiary, you can make a future gift without having to make any immediate out-of-pocket contributions. You can also maintain full control over your assets during your lifetime, knowing that your gift will make a lasting impact after your passing. Additionally, these gifts are generally free from estate taxes, ensuring that your donation goes further.
Charitable Giving Strategies: Boosting Your Impact and Tax Benefits
Giving to Kansas City Ballet not only supports the arts in your community but also offers significant tax advantages. Whether you choose to give now from your IRA or Donor-Advised Fund, or plan a future estate gift, there are many ways to structure your giving to create maximum impact.
When you plan your giving with the help of a trusted advisor, you can create a win-win scenario—reducing your taxes while providing lasting support to causes you care about. A well-structured charitable gift can also help you fulfill your broader financial goals, leaving a legacy that reflects your values and passions.
Whether planning a legacy gift or making an immediate impact, contact Director of Gift Planning Rebecca Zandarski at rzandarski@KCBallet.org or 816.216.5597 to ensure this process is both meaningful and rewarding for you.
Header image: Kansas City Ballet Dancers Andrew Vecseri and Kaleena Burks. Photo by Brett Pruitt & East Market Studios.
