The Conduit Election

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Categories: Advisors

Search Topics: Foundation Tax Strategies Strategic Planning

The Conduit Election, an election that can be made by a private foundation in any taxable year, permits donors to the foundation to treat donations made in an election year as though they had been made to a public charity instead. As shown below, treating donations as though they had been made to a public charity, rather than to the private foundation, provides two key advantages:

1. Higher adjusted gross income (AGI) percentage caps; and

2. A fair market value deduction for contributions of appreciated, long-term capital assets. This includes, but is not limited to, privately held stock, real property, notes, bonds and partnership interests.

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