News & Event
Over the last few years, we have talked extensively about how the Community Foundation’s work is divided into two parts: building our Community’s Endowment and providing Donor Services.
Dear Friends of the Foundation,
I hope you had a wonderful holiday season and are looking forward to a great year ahead.
I write to you today filled with gratitude and excitement. Over the last few years, you have heard me talk extensively about how the Community Foundation’s work is divided into two parts: building our Community’s Endowment and providing Donor Services.
From 2015–2017, we prioritized the Community’s Endowment side of our work as we engaged in our Today. Tomorrow. Forever. Campaign for our Community’s Endowment. With the momentum of some very generous matching donations, we spent a significant amount of time and energy elevating the important role that our Community’s Endowment plays in the long-term vitality of the Holland/Zeeland area. You all responded in amazingly generous ways that grew our Community’s Endowment by $5 million “Today” and our pipeline of “Tomorrow” estate gift commitments by more than $30 million.
With the campaign wrapped up and with the new Federal income tax law changes taking effect, in 2018 we prioritized the Donor Service side of our work. We spent time with companies, families and professional advisors highlighting the various tools we have to make giving as efficient and effective as possible. We were astounded and humbled by the deep generosity of many in our community as we received close to $20 million in contributions to Donor Service funds here at CFHZ. These gifts ranged in size from $25 to $7 million, and combined with nearly $1 million in gifts to our Community’s Endowment, led to CFHZ’s 2018 contributions totaling close to $21 million. That is more than double our previous high of $9.7 million!
These resources will impact many individuals and nonprofits in the Holland/Zeeland area, and we are honored that many of you chose to partner with CFHZ to help you best achieve your charitable goals.
For me, this record year says two things:
1. Our community is deeply generous and is committed to making a difference in the lives of others and
2. The hard work of so many staff and board members over the last 65 years has made the Community Foundation a trusted partner for many local families and companies.
Nothing inspires me more than having witnessed and felt these two things in profound ways over the last few months. It is a privilege to serve this organization and work with you all!
There was much more that happened during the year, but the above list aggregates some of the highlights from my perspective.
It was an inspiring year here at CFHZ and I want to thank each of you for all that you have done, and continue to do, to partner with the Community Foundation to ensure that the Holland/Zeeland area thrives Today, Tomorrow and Forever.
With deep gratitude,
For many, this time of year inspires gratitude and generosity. At the Community Foundation of the Holland/Zeeland Area, we are grateful for the community we serve and the many generous individuals who give back with their time, talent and treasure to make this place we call home so special. If you are considering how you will make a difference this year, consider these tips to make your charitable dollars go further.
If you have stock, bonds, or mutual funds you have owned for at least a year and have appreciated in value, it is likely a better asset to donate than cash. If you donate the appreciated asset as a gift to charity you will avoid paying capital gains tax while getting a tax deduction on the full market value. You may also donate complex, non-publicly traded assets to charity including private company stock, real estate, or other appreciated property.
As the fastest growing giving vehicle in the nation, Donor Advised Funds (DAFs) are a popular tool to organize your giving. You can bundle multiple years of giving into one year with a Donor Advised Fund to exceed the standard deduction. You will receive a charitable tax deduction at the time you donate to the fund, and can advise on the funds over several years so the charities you care about receive the sustainable support they depend on.
If you are at least 70 ½ or older and have an Individual Retirement Account (IRA), you can donate as much as $100,000 each year as a Qualified Charitable Distribution (QCD) to charity. A QCD may satisfy all or part of a Required Minimum Distribution (RMDs), which are not required until age 72, effectively lowering your Adjusted Gross Income for that year. Giving early distributions before you are 72 may save taxes when you must start taking distributions. The CARES act temporarily waives RMDs for all types of retirement plans (including IRAs, 401(k)s, 403(b)s, 457(b)s, and inherited IRA plans) for calendar year 2020.
The CARES Act increased the adjusted gross income (AGI) limit for cash contributions for individual and corporate donors. For cash contributions made in 2020, individuals can now elect to deduct up to 100 percent of AGI (increased from 60 percent) and corporations can deduct up to 25 percent of taxable income (increased from 10 percent).
DAFS are not eligible recipients for QCDs or qualify for the increased AGI limits, even though they are public charities. However, any other fund at CFHZ is eligible for either strategy, including establishing a designated fund.
We suggest that you consult with your financial, tax, or legal advisor to discuss the giving strategies that best align with your financial and charitable goals, then give the Community Foundation of the Holland/Zeeland Area a call and we will work with you and your professional advisor(s) to help employ smart giving strategies.
Contact Colleen Hill, Vice President of Development & Donor Services, via email or by calling 616-994-8853.
‘Tis the season when many people are considering their year-end charitable giving. It is our favorite time of year at the Community Foundation because we never cease to be inspired by the generosity in our community. This year many are considering the new landscape laid out by the Tax Cuts and Jobs Act (The Act) signed into law in December of 2017 as they determine how and how much they are going to give this year.
Since the passing of The Act we have shared what we believe is the good news for charitable giving. For starters, the reasons people give charitably are many and varied and most often align with a desire to give back and help others. A leading indicator of how much individuals will give is their available discretionary income. That might be the best news of all as the primary motivation for The Act was decreasing the amount of money in the federal government and increasing the amount of money in private citizens hands.
That means people on balance will have more discretionary income to potentially give to charity. And by using one or more of the tax smart strategies laid out in this article—gifting appreciated assets, bunching donations into one tax year and making qualified charitable distributions from one’s IRA—individuals and companies have the opportunity to give even more this year.
Let’s take a look at the main points of The Act that are likely to have the largest impact and how this may affect charitable giving.
The tax benefit is rarely the main reason people support nonprofits in the first place. People give because they want to make a positive difference in the lives of others and in our world. The needs in our community didn’t go away, so your opportunity to care for your neighbor didn’t go away either. And you will likely be able to give just as much to charity as you have in the past and still increase the amount of your income due to the lower tax rates.
The leaves have changed color, snowflakes have begun to fall, and turkeys will soon go in the oven in preparation for family and friends gathering together. It is a time of year that for many inspires gratitude and generosity. At the Community Foundation of the Holland/Zeeland Area, we are grateful for the community we serve and the many generous individuals who give back with their time, talent and treasure to make this place we call home so special. If you are considering how you will make a difference this year, consider these tips to make your charitable dollars go further.
It’s been another year of strong investment markets. If you have stock, bonds or mutual funds you’ve owned for at least a year and have appreciated in value, it is likely a better asset to donate than cash. If you donate the appreciated asset as a gift to charity you will avoid paying capital gains tax while getting a tax deduction on the full market value.For example, in 2017 you bought shares of XYZ Corporation for $100 per share. Today, those shares are worth $200 per share. If you sell the share, you’ll pay capital gains tax on the $100 difference between the sale price and purchase price. If you donate the share, you will avoid paying the capital gains tax and may take a tax deduction—if you itemize—for the $200 donation.
Pro tip: You may also donate complex, non-publicly traded assets to charity including private company stock, real estate, or other appreciated property.
As the fastest growing giving vehicle in the nation, Donor Advised Funds are a popular tool to organize your giving. Perhaps you want to gift an appreciated stock, but you want to support several organizations and don’t want to initiate multiple stock gift transactions. You can make one gift to a Donor Advised Fund, receive one receipt for your gift, and advise on which organizations the fund will support. If you’d like to transfer shares when the value reaches a certain level but want extra time to decide which charities to support, you could give the stock to a Donor Advised Fund. You can take a charitable deduction when you give the shares, but you have time to decide which charities to support.
Pro tip: You can bundle multiple years of giving into one year with a Donor Advised Fund to exceed the standard deduction. You will receive a charitable deduction at the time you donate to the fund, and can advise on the funds over several years so the charities you care about receive the sustainable support they depend on.
If you are 70 ½ or older and have an Individual Retirement Account (IRA), you are able to donate as much as $100,000 each year as a Qualified Charitable Distribution (QCD) to charity. A QCD may satisfy all or part of your Required Minimum Distribution effectively lowering your Adjusted Gross Income for that year.
Pro tip: An IRA QCD may not be donated to a Donor Advised Fund, however, you may establish a Designated Fund naming one or more charities you wish to support and at what schedule (lump sum or over a period of time).
We suggest that you consult with your financial, tax or legal advisor to discuss the giving strategies that best align with your financial and charitable goals, then give the Community Foundation of the Holland/Zeeland Area a call and we will work with you and your professional advisor(s) to help employ smart giving strategies.
Contact Colleen Hill, Vice President of Development and Donor Services, at 616-994-8853 or via email.
Get the most out of your charitable contributions with a Donor Advised Fund, the fastest-growing giving method in the nation. The reasons Donor Advised Funds are so popular are numerous and growing. Here are our top 10 reasons why you should consider using a Donor Advised Fund for your own charitable giving.
To learn more about how Donor Advised Funds can simplify your giving and increase your impact or contact Colleen Hill, Vice President of Development and Donor Services at firstname.lastname@example.org
The Community Foundation of the Holland/Zeeland Area’s (CFHZ’s) Line of Credit (LOC) Guarantee Program allows nonprofit organizations that are tax exempt under Section 501(c)(3) of the Internal Revenue Code, are serving a charitable purpose in the greater Holland/Zeeland area, and had a 2019 operating budget in excess of $500,000 to apply to have a CFHZ guaranteed line of credit established through West Michigan Community Bank.
CFHZ’s Line of Credit Guarantee Program has a total cap of $2 million, so we anticipate being able to partner with 10-15 nonprofits through this program. Please note – as with CFHZ’s competitive grantmaking program, religious organizations that advocate specific religious doctrines through their programs, or do not serve the broader community, are not eligible.
Those nonprofit organizations accepted into this program by CFHZ will then be connected to West Michigan Community Bank (WMCB) to establish their line of credit account. Since CFHZ is guaranteeing this line of credit, the nonprofit will not have to put forward any collateral, nor will the nonprofit go through a traditional underwriting process.
In addition to guaranteeing the LOC, CFHZ will provide reimbursement to the nonprofit for all interest that the nonprofit has paid on the LOC during the first 2 years, up to 4% per year. During the third year that the LOC is open (third year is open for repayment only), CFHZ will not be reimbursing interest costs paid by the nonprofit. Here are some additional details on how the interest reimbursement will work:
CFHZ has been listening to our partners as they describe the significant cash flow challenges being experienced so suddenly due to loss of revenue and increased demand for services during this pandemic crisis. We have heard that significant decisions need to be made quickly, and without a lot of clarity as to what the next 3-12 months are going to look like.
In response, we are launching this new program as a way to further leverage our Community’s Endowment assets to support some of our mid-to-large nonprofit partners and preserve critical community capacity in this time of extraordinary need.
Here is what we hope the program will accomplish:
We understand that this is likely not going to prevent nonprofits from having to make tough choices down the road, as this isn’t grant money, but it will hopefully provide nonprofits the gift of time to make those choices and the option of choosing to spread the difficult decisions out over a multi-year period.
We also acknowledge that by only allowing nonprofit organizations with budgets over $500,000 to apply for this program that this tool is for a limited portion of our nonprofit sector. We recognize that many of our smaller nonprofit organizations are doing very important and critical work as well and want to be clear that this particular program is only one tool in our toolbox.
In addition to this LOC guarantee program, we are utilizing the Emergency Human Needs Fund to deploy capital over a six-week period to organizations providing emergency basic needs services, and we will be re-working our competitive grantmaking strategy for the remainder of 2020. We anticipate our new competitive grantmaking framework and process to be announced in June when we have a better sense of how the federal stimulus funds have supported our community members in need and our nonprofit partners.
Please note – participating in this Line of Credit Guarantee program does not preclude an organization from receiving a grant from CFHZ. This is an entirely different process and tool.
Applications will be reviewed by a joint taskforce of CFHZ Distribution Committee and Program Related Investment (PRI) Committee members with support from CFHZ staff. The review committee will be choosing organizations based on the following priorities:
Step 1: Submit your CFHZ line of credit guarantee program application via the following link by April 24, 2020:
You can use this PDF as a worksheet to view all questions in preparation for submitting the application form online.
The PDF worksheet shows you the “word count” limits for each question, but you do not need to use all the words, and lists are fine. In addition to the PDF worksheet that shows the “open ended” questions in the application, you will also be asked to submit attachments as follows:
LOC GUARANTEE PROGRAM APPLICATION
Step 2: CFHZ will reach out to the contact listed for your organization as close to May 4 as possible with our final decision as to whether your nonprofit has been accepted into the program. We may reach out to you ahead of this date if additional information is needed alongside your application.
Step 3: If your nonprofit is approved to be included in this program, CFHZ will provide your organization it’s Line of Credit dollar approval limit, and will connect you to West Michigan Community Bank in order to establish your line of credit account via a separate application (which will NOT involve collateral or underwriting).
Step 4: At that point, any ongoing communication and reporting requirements will be between the nonprofit organization and their assigned contact at West Michigan Community Bank, with CFHZ being involved only in reimbursing interest every 12 months for the first two years.
Unlike our competitive grant program, you do not need to contact CFHZ prior to completing this Line of Credit Guarantee application. However, if you do have additional questions about the program or application, please contact Mike Goorhouse at email@example.com or 616-994-8855.
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