As the year comes to a close, many individuals and businesses focus on their charitable contributions—not only to support the causes they care about but also to take advantage of tax benefits. However, timing is everything. To ensure your donations qualify for a 2024 tax deduction, it’s essential to meet specific deadlines and prepare for the unique requirements of different types of contributions.
Timing Matters: Contribution Deadlines
The deadlines for processing charitable contributions vary depending on the type of asset you’re donating. Missing these critical dates could prevent your donation from qualifying for a 2024 tax deduction, so it’s important to plan ahead.
- Checks: Contributions via check must be postmarked by USPS by December 31.
- Electronic Funds Transfer (EFT): Transfers must be initiated by 11:59 p.m. ET on December 31.
- Wire Transfers: Funds must be received by 11:59 p.m. ET on December 31.
- Credit Card: Contributions must be charged to the credit card by 11:59 p.m. ET on December 31.
- Qualified Charitable Distribution from Your IRA (QCD): The funds must be transferred from the IRA to the charity by December 31.
- Mutual Funds Held Outside Your Investment Firm: Processing times can vary but typically will take two to six weeks. Please check with your investment firm in order to ensure enough time is allowed for processing. Assets must be received by 11:59 p.m. ET on December 31.
- Physical Stock Certificates of Publicly Traded Companies: Processing times can vary but typically will take two weeks. Please check with your investment firm. The transfer of stock to the charity must be initiated by 11:59 p.m. ET on December 31.
- Publicly Traded Securities: The transfer of stock to the charity must be initiated by 11:59 p.m. ET on December 31.
- Control and Restricted Stock: These donations often require longer processing times. Please check with your institution for the date paperwork should be submitted by. All assets must be received by 11:59 p.m. ET on December 31.
- Cryptocurrency: Assets must be received and cleared through the blockchain by 11:59 p.m. ET on December 31.
Early Planning Ensures Success
Complex donations, such as control stock, mutual funds, or non-publicly traded assets, require extra time for processing. Starting early helps avoid last-minute complications that could jeopardize your ability to qualify for this year’s tax benefits.
If you’re uncertain about the deadlines or processes for your specific contributions, we are here to help. Please do not hesitate to reach out to discuss your specific situation.
By following these guidelines and planning ahead, you can maximize the impact of your charitable giving while ensuring it aligns with your tax planning goals. Make this year’s generosity count—for both your favorite causes and your financial well-being.
This material has been prepared for general, informational purposes only and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. Should you require any such advice, please contact us directly. The information contained herein does not create, and your review or use of the information does not constitute, an accountant-client relationship.
