Tax Hacks for Generous Hearts: Give Big, Save Smart

​Charitable giving doesn’t just feel good—it can be a powerful tax-saving tool too. Whether you’re passionate about a cause or looking to leave a legacy behind, there are ways to align your generosity with smart financial planning. At The Law Offices of Samantha K. Wolfe, we help clients give with both heart and strategy.
So, how can giving save you money?
Let’s start with the basics. Charitable contributions can reduce your federal income taxes, lower your estate’s taxable value, and—even better in Pennsylvania—charitable gifts are exempt from inheritance tax.
You’re not limited to cash donations either. You can give:

• Appreciated assets like stocks or real estate (and avoid capital gains taxes).
• Tangible personal property like art or collectibles.
• Retirement accounts by naming a charity as a beneficiary—great for avoiding income and inheritance tax.

Want to go beyond the basics? Consider these strategic tools:

• Donor-Advised Funds (DAFs): Make a tax-deductible contribution now, and distribute to your favorite charities later.
• Charitable Remainder Trusts (CRTs): Receive income during your lifetime and give the rest to charity, all while deferring capital gains taxes.
• Charitable Lead Trusts (CLTs): Give now to charity and pass the remaining assets to your heirs with reduced estate tax.
• Qualified Charitable Distributions (QCDs): Donate directly from your IRA (if you're 70½+) to satisfy RMDs and avoid taxable income.
• Charitable Gift Annuities: Support a cause and receive fixed income payments for life—part gift, part annuity.

Each of these strategies not only supports the causes you care about but can also lead to significant tax savings if done right.
And if you’re thinking about converting a Traditional IRA to a Roth IRA, charitable giving can help you offset the tax bill. By pairing a Roth conversion with a CRT or large donation, you might reduce or even eliminate the taxes due on the conversion. The result? A tax-free legacy for your heirs and meaningful support for charity.
The bottom line: your charitable goals and your financial goals don’t have to compete—they can work hand in hand. With the right plan, you can leave a lasting impact while reducing your tax burden.
Interested in learning how charitable giving fits into your estate plan? We would be honored to help you give smart.
Call us today at (717) 655-2676 or visit us at 20 East Sixth Street, Suite 206, Waynesboro, PA 17268.