Thanksgiving means different things to different people, even just within the United States. But no matter what we do on the third Thursday of November, everyone can find a profound depth to the word “thanksgiving” itself.
By giving thanks, we acknowledge that something has gone right in our lives. It’s about focusing on the positive rather than dwelling on the negative. This act can make us feel more content and strengthen the bonds we feel with others.
When we acknowledge the good in our lives, we also think about how we can help others feel the same warmth. That’s why the season of thanksgiving is also the season of giving back.
From thanker to thankee
Helping others while helping our mental health at the same time . . . what’s not to love?
We’ve always found entrepreneurs to be a caring, generous group. It’s why Class VI was inspired to create the Why Project and happily contribute part of each deal’s fees to the client’s favorite charity. But it’s not always apparent how to give effectively—in an organized, impact-maximizing, tax-advantaged way.
We’re here to help.
Leave a legacy
Post-sale liquidity brings all kinds of opportunities, including the ability to increase your philanthropy. This Thanksgiving season could be the time to reimagine how to structure your giving in a lasting, impactful way.
Below are some ideas for securing a charitable legacy, each with different tax benefits as a bonus.
💟 Donor-advised funds let you donate cash or assets to an investment account and recommend distributions to any 501(c)(3) charities of your choice. Investment growth isn’t taxed, and DAF contributions are eligible for tax deductions.
💟 Private foundations take a bit of work to establish, but they can be great vehicles for your family to give generously over time. You set up an IRS-registered charity that provides you or a family member control over investments and donations. This can be a great way to instill a philanthropic tradition in your heirs.
💟 Appreciated assets are often donatable by themselves or in combination with cash—many charities would be happy to take bonds, stocks, or mutual funds off your hands! And because you’re not cashing them out yourself, you won’t pay capital gains tax on the proceeds.
You’ll want to consult your wealth advisor before making any major giving decisions. They’ll be able to help you choose a strategy that meets your needs and suits your budget. Depending on your situation, they may even recommend retaining a philanthropic advisor to ease the set-up and management of your charitable vehicles.
Make the most of your gifts
There are some causes you’ll want to donate to no matter what: an organization you’ve had a positive experience with, one that you worked or volunteered for, or one where you know a family member or friend.
For every other case, it’s important to vet the organization before committing resources. Here are some variables to research:
💟 501(c)(3) status. This designation marks the organization as tax-exempt based on IRS evaluation, giving it credibility.
💟 Transparency. Trustworthy charities make their financials, org charts, and impact metrics publicly available.
💟 Measurable outcomes. Is the organization collecting data about its impact so it can improve its reach and effectiveness?
💟 Spend. This is how you analyze the amount a charity spends on its program delivery versus what percentage goes to overhead like administration and facilities costs.
💟 Geographic impact. Are you looking for local causes or something with a wider reach (e.g., a medical research organization)?
There are a number of nonprofit charity-rating organizations, each with its own assessment methodology. Read through their “about us” information carefully to find one you trust, then use it to find organizations you feel comfortable supporting.
Class VI’s commitments
We have a wealth of experience with philanthropic giving: the Class VI Family Office manages over $17 million in DAFs and we’ve donated portions of deal fees to client-approved causes ranging from children’s hospitals to humane societies.
There are also several causes close to our hearts if you’re looking for inspiration!
💟 HighView describes itself as the world’s first student accelerator, and it’s a cause we’ve fallen for hard. HighView raises up talented low-income students in the Denver area who might otherwise lack the opportunities and networks available to others. Through experience with partner businesses, students learn soft professional skills that will serve them no matter what path they take, and 100% of HighView program graduates have been accepted into college with scholarship opportunities.
💟 Denver Kids is another student support organization that gives holistic help to Denver Public Schools learners. Each participant receives mentorship, educational and social-emotional counseling, and enrichment experiences designed to support their development for an average of six-and-a-half years once they enter the program.
Give yourself
Of course, your generosity doesn’t need to be limited to monetary contributions (as welcome as those are!). For example, your business experience makes you a valuable asset to many charity boards, and those charities would happily make use of your time as a volunteer helping to fulfill their missions.
You also have a lot to offer to business owners currently in the trenches. There are plenty of mentorship opportunities wherever you live—we love making connections through the Class VI Community and then watching those relationships flourish!