What’s important to you? It’s a question I ask my clients on a regular basis. From your job, to your family, to donating to organizations you believe are making a positive difference in the world, it’s part of my job to help you establish a list of priorities in your life. If we don’t know what is important to you, then we ultimately can’t give you financial advice customized to your unique financial situation.

Once we’ve established your priorities, it’s time to discuss how we’ll help you reach your goals. When it comes to charitable giving strategies, there are multiple methods we can employ. Here’s a closer look at the strategies to consider.

Charitable Giving Strategies for Executives


There are many strategies when it comes to charitable giving, but not every strategy is especially effective for top-level executives. Below are some of the most effective charitable giving strategies for executives.


When it comes to donating to charity, many corporate executives are used to writing out a check or donating cash as charities approach them for sponsorship. While it’s great to feel the instant gratification of making an immediate difference through a cash donation, that may not be the best strategy for you or the charity. One of the most effective charitable giving strategies for executives to consider is to donate low cost basis stock to the philanthropic organization of your choice.

How It Works

Chances are, as a top-level executive, you have purchased company stock through stock options or other incentive plans at a discounted rate. Over the years, that stock has likely gone up in value, all the while building a potential capital gains tax bomb within your account. One way to alleviate that capital gains burden is to donate that low basis stock to the charity of your choice.

When you donate the stock directly to the charity, you give the charity the ability to sell the stock itself, removing the taxable burden from your shoulders and giving you a tax deduction at the same time. Because charities are exempt from capital gains tax, the charity inevitably receives a larger donation than if you sold the stock and then donated the cash.

To execute a strategy like this, you simply need to transfer the stock into the charity’s name. An experienced executive financial advisor will be able to help you with the transfer and ensure that everything is done correctly to avoid any confusion come tax time.

If you’d like to donate stock to more than one charity in a given year, simply title a set number of shares to every charity you want to donate to. For tax filing purposes, all of the charities that you have donated to will send you an itemized list of your donations, which you report to your tax professional so that the proper filings can be made.  

Benefits at a Glance

  • Avoid capital gains tax on appreciated stock while taking a charitable tax deduction.
  • Make a larger donation because charities are exempt from capital gains tax.
  • Donate to multiple charities in a year.
Donor Advised Fund Charitable Giving Strategies


A donor-advised fund (DAF) is one of the best strategies to use when you know you want to donate a certain amount of money to charity, but you aren’t sure exactly which particular charities you want to donate to, or the specific timing of the donations.

How it works

A DAF is an account that holds the funds intended to be given to charity. The funds remain in the account until you decide when and where you want to send your charitable donations. A DAF can be set up with the help of an executive financial advisor.

When you deposit money into a DAF, you receive the charitable tax deduction for the year in which you make the deposit, even if you let the money sit in the account and accumulate for years before you donate it to the charity or charities of your choice.

For example, if you know that a particular charity will be raising funds for a project in a few years, but you have the ability and need to donate to charity this year, you can utilize a DAF to hold those charitable funds until the organization begins its fundraising campaign. Meanwhile, you enjoy the benefit of the charitable tax deduction in the year you deposited the funds.

Benefits at a Glance

  • Donate to multiple charities from one fund.
  • Receive a charitable tax deduction in the year you deposit assets, even if the money hasn’t been given to charity yet. This allows you to deposit assets when it’s most helpful for you and make grants when it will be most helpful for the charity.
  • A common misconception is that a DAF must be funded over a certain amount threshold. However, in reality, you can fund a DAF with a relatively small amount.
Qualified Charitable Distributions as Charitable Giving Strategies


Another charitable giving strategy, for those old enough, is to donate your unneeded required minimum distributions (RMDs) by converting them into qualified charitable distributions (QCDs).

How it works

Anytime you set up a qualified retirement account, the government gives you tax deductions (depending on your income level) when you contribute to that specific account, with the understanding that you will pay taxes on the income generated from that account in the future. If you do not have a need for the income, you can allow that account to accumulate over the years without any taxation.

Once you reach the age of 70½, however, you are required by the IRS to withdraw a certain percentage of all of your qualified accounts. Whether you choose to draw the funds from one or multiple accounts, the overall percentage is the same. This is one of those things, like death and taxes, that cannot be avoided. You will eventually be required to do something with that money, and every year the percentage required to withdraw will increase.

If you have no need for the income, you would just be adding additional and growing taxation to your financial situation. However, converting your RMDs into QCDs might just be the solution you were looking for. To achieve this, an experienced wealth advisor can help you set up the RMDs to be deposited directly to the charity of your choice, effectively creating QCDs.

In addition, money donated through QCDs do not count against your charitable tax deduction for the year, meaning you can donate 100% of your RMDs, pay no taxes on that money, fund the charity of your choice, and also continue to receive tax deductions for the other charitable contributions you make on top of the QCDs. For example, if you have always wanted to give back to your alma mater but have felt a burden to fund other charities that seem to have a greater need, this is a great opportunity to finally give back and avoid taxation while doing it.

Benefits at a Glance

  • Avoid paying income taxes on unneeded RMDs.
  • Donations made as a QCD don’t count against your charitable tax deduction for the year, so this method can be used with other charitable giving strategies to fund multiple causes you care about.
charitable remainder trust


Many clients we work with want to leave a legacy by donating a sum of money to a charity that is near and dear to their heart. However, they also need supplemental retirement income for the foreseeable future. In these cases, a charitable remainder trust can be a good strategy to employ.

How it works

A charitable remainder trust can be set up with the help of a wealth manager. When you establish this type of trust, you place assets—such as appreciated stock, for example—inside of it. A trustee, appointed by you, invests the assets in an income-producing asset, such as an annuity or traditional investments. This income then can be used by you as your supplemental retirement income. When you pass away, the amount left in the trust is donated to charity.

Another option, if you wind up not needing the income, is to buy a life insurance policy with the income stream generated by the charitable remainder trust. In that instance, the life insurance policy leaves money to heirs tax free, while the charity receives the remainder of the funds left inside the charitable remainder trust upon your passing.

Benefits at a Glance

  • Avoid taxation on assets placed in the trust, such as capital gains tax on appreciated stock.
  • Generate income while you are alive to fund your retirement and ensure your family is taken care of.
  • Fulfill your charitable giving goals with money left in your trust upon your death.
  • Enjoy a charitable tax deduction when you place your asset in the trust.
charitable gifting planning services


At the end of the day, there is no-one-size-fits-all strategy when it comes to charitable giving strategies.

This is one of the many reasons why it’s important to work with an experienced executive financial advisor when it comes to implementing these strategies. As experts in financial planning services for charitable gifting, we can help you take a comprehensive look at your assets and explore strategies that fit your specific desires and priorities.


What do you want your success to help you accomplish next? No dream is too big. Contact Wade and the Carpenter Team today for strategic wealth management advice that will enable your goals now and into the future.