Smart Gifting Strategies That Pack Rewards Beyond Tax Benefits

Kolleen Schocke |

Few things in life are more fulfilling than witnessing your legacy in action. These gifting strategies not only offer tax benefits but also show the fruits of a thoughtful legacy plan. Consider the following gifting strategies this holiday season:

  • For adult children: The IRS allows you to gift up to $15,000 per individual free of gift or estate tax.
  • For grandchildren: Make a contribution to a grandchild’s 529 Education Savings Plan. Earnings are not subject to federal tax and are generally not subject to state tax when used for qualified education expenses of the designated beneficiary.[1]
  • For the friend who has everything: Consider a tax-deductible contribution in their name to a charitable or other not-for-profit organization they’re passionate about.
  • For the charitable organizations you support: Make a tax-deductible year-end cash contribution or donate securities (such as shares of stock), or real property such as a car or boat.

Qualified charitable distributions (QCDs) permit a direct transfer of up to $100,000 from an IRA to a qualified charity. Note: You must be age 70 ½ to be eligible.

And don’t forget to give a tax-advantaged gift to yourself:

  • Contribute the maximum amount allowable to any 401(k), 403(b), or similar employer-sponsored retirement plans you are eligible to participate in by the December 31 deadline ($19,500 if you’re under age 50).
  • Take advantage of annual catch-up contributions ($6,500) if you’re age 50 or over, for a maximum contribution of $26,000 in your employer-sponsored plan.

If you have questions about legacy planning, charitable gifting, or other wealth planning strategies, please reach out to schedule a time to talk.




Distributions from traditional IRAs and employer-sponsored retirement plans are taxed as ordinary income and, if taken prior to reaching age 59½, may be subject to an additional 10% IRS tax penalty.

These figures are representative of 2021 contribution limits.

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