Register for Good
Creating a wedding registry filled with all the goodies a newlywed couple could want can be an enjoyable pre-wedding activity. There’s nothing quite like the feeling of wish-listing with gleeful abandon: KitchenAid mixer? Of course! Garlic press? Gotta have it!
But what if you already have all the kitchen gadgets you could ever hope for, and your towels are less than a year old? You know your guests want to celebrate your union with gifts (they may already be inquiring about where you have registered), but you just don’t need any more stuff! If this sounds like you, it might be time to consider using your registry to support causes you care about and give yourself (or your guests) a bonus tax benefit.
It’s better to give than to receive, but why not do both?
Many online wedding registries, like this one on Zola, have an option for guests to make charitable contributions as a gift to the happy couple. Donations to qualifying non-profit organizations do double duty by giving a benefit to the organizations while creating a potential tax deduction for the donors, making a donation registry a great way for your wedding gifts to keep on giving.
There are a couple of things to consider when you are giving your guests the option to donate to charities. First, who will get the tax benefit? Do you and your spouse itemize your deductions or do you take the standard?
If you do itemize your deductions, having guests give monetary gifts to you and designate them for charity allows you to take the donation as a deduction on your taxes, as well as leaving the final word on how and where the donations are spread around up to you and your partner. If you take the standard deduction, you might consider an alternative that allows your guests to donate directly to the charities of your choosing, making the deduction available to your friends and family who may benefit from it.
Bonds (and Stocks) of Matrimony
I know what you’re thinking: there’s no way this scenario could possibly get any better. Well, I hope you’re sitting down because it CAN! Income from the sale of appreciated stock (stock that has increased in value over time) can be taxed at a lower rate than other kinds of income. This lower rate is known as the capital gains rate. If a friend or family member is nice enough to gift you with stock such as this and you sell it, you will pay taxes on the difference between the price the giver paid (this is their “basis”) and the sales price.
Here’s where it gets good: if, rather than selling that stock, you were to donate it to a charitable organization, not only do you get a tax deduction for the donation of the fair market value of the stock (meaning the value on the day you donate it), but the organization doesn’t pay tax on the gain!
Using your wedding registry to let guests contribute to charities is a great way to spread the love through donations and great tax benefits.
If this all seems confusing, don’t worry, we have advisors to help guide you through all the new adventures of life and taxes. Talk to a Visor tax specialist today!
Done filing taxes alone? Lock in discounted 2019 pricing!