Designated beneficiaries who are not a minor child, a spouse or disabled and own an inherited Roth IRA must distribute the entire account within ten years of the original owner’s death. Distributions generally will not be taxed. However, these accounts can also be a gifting source, but should be considered in the context of the long-term tax-free wealth accumulation.

Assets held in qualified accounts like IRA’s cannot not be gifted to a Donor Advised Fund. However, highly appreciated assets that are not held in a qualified account can also be gifted, in kind, to a qualified charity. Selling a highly appreciated asset and then gifting cash from the sale results in capital gains taxes. Gifting the asset directly to the charity would avoid any taxes. You may also be eligible for a tax deduction for the gift if you itemize. Be careful here, there are special rules for claiming deductions of property.

If you are not sure what charity you want to support, but would like a current year tax deduction, consider a Donor Advised Fund. You can decide what charity you would like to support at a later date. A Donor Advised Fund is a private fund administered by a third party, such as Charles Schwab, Fidelity, or Vanguard. It is created for the purpose of managing charitable donations on behalf of an organization, a family, or an individual.  The biggest advantage of Donor Advised Funds lies in the immediate tax benefits.