B Charitable, launched in 2019, is a platform that enables customers to donate cryptocurrency as ‘charitable contributions’ recognised by the IRS.
For IRS reporting purposes, the majority of P2P crowdfunding platforms that accept donations are not deemed ‘charitable contributions.’
B Charitable has announced a collaboration with YouTuber Andrei Jikh.
B Charitable, one of the industry’s few charitable giving platforms that capitalises on the tax benefits of charitable contributions and combines them with smart technology, crowdfunding campaigns, low fees, performance tracking, and tax-deferred investment growth, enables individuals to make proactive charitable contributions.
Its most recent improvement allows users to donate in stocks or cryptocurrency by simply clicking the “Donate Crypto” button on their dashboard.
According to Jonathan Shugart, founder and president of B Charitable, donations received through the majority of P2P crowdfunding platforms are not deemed ‘charitable contributions’ for IRS reporting reasons — even if the individual plans to utilise the funds for charitable purposes.
Shugart, a former tax attorney, spent the first five years of his private practise advising high-net-worth people on estate and business planning matters. When advising clients, discussions regarding charity giving were limited to a few wealthy clients and, unfortunately, were not accessible to the bulk of generous people.
“I am a firm believer that individuals are innately motivated to assist others,” he stated.
“It’s in our nature, so I wondered what it would look like if we created a tool that made it easier; a tool that empowered others to be charitable” — in this case, a proactive approach rather than the reactionary one that many frequently take.
According to Shugart, two areas that B Charitable has spent considerable time investigating are how to “eliminate/minimize the effect of crypto value fluctuation” and “providing a personalised experience for each transaction with prompt, proper reporting, while minimising the time/effort required of a donor.”
As a donor advisory fund (DAF), the platform enables donors to retain “advisory privileges” over how those funds are distributed. It enables users to contribute cryptocurrency to any IRS-recognized public charity of their choice, so allowing them to avoid capital gains tax due to their ‘DAF’ status.
As a DAF, we are limited to making distributions to charitable organisations, which is why donors can deduct charitable contributions when they invest in a DAF, Shugart said.
While some tax-exempt organisations permit cryptocurrency donations, Shugart notes that the majority of nonprofits are “not particularly computer savvy.”
We feel our procedure is the most efficient, and rather than reinventing the wheel, charities can direct contributors to our platform to make cryptocurrency contributions, he said CoinQuora.
How does it operate, then?
B Charitable is able to accept crypto contributions on the blockchain and then convert them to a form of currency that charities can use, like as fiat, before distributing them to charities in response to the donor’s grant request. In other words, the donor is not obligated to convert the cryptocurrency to cash.
With bitcoin becoming more appealing for charitable endeavours, platforms like B Charitable have become increasingly important and critical in the last week to assist in providing suitable resources and support to individuals affected by the Ukraine crisis.
B Charitable established a relationship with YouTube influencer Andrei Jikh on Wednesday. Jikh is recognised for generating financial-awareness material about the stock market, investing, and motivation.
Jikh, whose YouTube channel has over 1.7 million subscribers, was up in a family of Russian circus performers and relocated to the United States when he was nine years old when his father was hired by Cirque du Soleil.
Jikh recently launched a campaign in support of “Save the Children,” a non-profit dedicated to resolving the continuing Russia-Ukraine crisis, in which he has committed to match 100% of the first $10,000 in donations.
It’s worth noting that crypto aficionados should be aware of the tax benefits available to DAFs such as B Charitable.
“If you gift an appreciated asset rather than selling it and then donating the money, neither you nor the charity pays income tax on the sale,” Shugart notes.
Additionally, he notes that individuals may contribute to a donor advised fund during the year in which they seek a charitable contribution deduction, even if they do not necessarily distribute the funds to the charity of their choice until a later date.
Disclaimer: These are the writer’s opinions and should not be considered investment advice. Readers should do their own research.