Michael Hardy was introduced by our Program’s Chair Hamid Ahmadi. In keeping with our month’s Rotary Theme, Economic and Community Development Month, he said that Michael is Certified Financial Planner and a Chartered Adviser in Philanthropy and will talk on the subject “A Rationale for Effective Philanthropy”.
Michael started out by telling us that there are 78 days until Christmas. 2% pf the GDP will be given to charity in cash and 30% of the annual income for non-profits come in December and 10% in the last few days. Much comes in the last few hours. Charities are asking for cash. This is the smallest part of people’s assets – only 3%, larger amounts are in homes, investments, IRAs and other. Charities are asking for annual giving from discretionary income – they will get more for their causes by appealing for other assets than just cash.
Every $1000 in non-profit deduction can benefit from 44% in taxes and you can save by using appreciation tax and what is tax deductible – it is called bunching. You can use bunch years and get way above the standard deduction.
Michael gave an example, such as putting investment property in a trust. Some people have had investment properties for many years and wish to fund their favorite charity and get rid of the responsibility of the property. The trust may be 90% funded with real estate. It may be depreciated down to 0. You may be able to gift the property to a charitable trust and get a higher income and a deduction of a large amount.
Michael also talked about converting an IRA to a Roth IRA to avoid taxes and how to be smart when you are downsizing a home. There are other strategies available, Michael says, to help you be more efficient with your money and still give to charity. There was not enough time (20 minutes) to cover all the strategies. We all agree, a good idea is to save on taxes.
President Vicky let Michael know that a book has been dedicated (in honor of his presentation to the Carmichael Library (Sacramento Public Library)
FYI: Michael Hardy, Senior Vice President for UBS wealth management, 1610 Arden Way, Suite 200, Sacramento, CA 95815. Tel: (916) 648-7244., michael.e.hardy@ubs.com