Ok, I know I really need to see an expert for this (& I will be doing so within the month). But, I thought I could get some possible strategies in advance.

Here's the facts in a nutshell:

1) Our income this year is ENORMOUS, since I left an Internet startup & exercised/sold most of my options.

2) I want to make a LARGE donation to a non-profit org that I am starting. I don't need to put all of the money in this year, but I'll need a good chunk this year & the rest next year.

3) Next year our taxable income will be pretty small, since I won't be working (no need to).

I seem to be stuck between a rock & a hard place, since if I make the donation this year, my income level seriously limits my tax benefits (i.e., my calculations show that I "get back" 25% of the donation, as opposed to 40%).

So, I could make a smaller donation this year & then put in the bulk next year. But, then I'd be hit with the 50% AGI limitation (remember, my income next year is small).

I know I am able to carry forward the extra donation amounts in this last case, for 5 years. But, I'm afraid that my income will continue to be small for the forseeable future, so I will probably still be bitten by the 50% AGI limitation.

Any ideas?

Cheetah

Ok, I know I really need to see an expert for this (& I will be doing so within the month). But, I thought I could get some possible strategies in advance
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Good Idea as I read the rest of your post. Situations like this generally require running some proforma "what if" returns based on your assumptions as to income and deductions.

The problem may exist that due to your high income in 1999 a certain amount of your charitable deduction is not allowed due to the level of your income. IOW you may make a 100,000 donation and actually only get 80,000 in deduction. (example only)

I had a similar option situation last year. We determined that the tax savings of accelerating the donation into 1998 was not advantageous in that the client felt he could make more money with that potential savings invested for another year in the market.

But we were only talking about a 5k donation too.

Get all your facts together and let the professional
run some what if scenarios.

Finally, if there is the potential that any of your contribution carryover would expire unused I would lean towards acceleration. The old adage "when in doubt, take the deduction" applies here.

I assume you are young but others may want to know that if you die with unused contribution carryovers - they are lost - no one gets to use them.

Pete