November–December 2019 Your guide to Charitable business gift gift giving etiquette Your holiday Reduce your business rush holiday hosting survival guide risk Best holiday quiz ever! From the f irm A season of giving… ere we are at the tail end of the year. And that • A new take on milk and cookies—If your family H means it’s time to get things wrapped up so wants to serve up something a little different for you can breathe easy and enjoy this special season. Santa or just enjoy a seasonal sweet treat, dive Be sure to check out our year-end tips to help you. into our recipes. Then it’s time to unwrap some holiday cheer, starting Of course, business doesn’t completely stop at with everything this issue has to offer…including the holidays, and you probably have more than these holiday goodies: a few work-related gatherings and gifts on your • ’Tis the season for giving to friends, family and list. To help you get through everything as grace- coworkers. We keep you updated on the most fully as possible, check out our holiday etiquette current charitable giving and gift rules. for business. • Hosting tips to ensure everyone can enjoy Wishing you a wonderful holiday season! holiday cheer safely. • Take your guests for a trip around the globe Sincerely, this holiday with our festive quiz. Your trusted advisors 2 | NOVEMBER–DECEMBER 2019 In this issue November–December 2019 Features 4 4 • Your guide to business gift etiquette ’Tis the season for generosity and showing others appreciation. Here are some pointers to make sure any present you give (or receive) follows proper business etiquette. 6 • Charitable gift giving Planning to give to your favorite charity this year? Check out our brief overview to help you give wisely. 8 • Your holiday business rush survival guide 6 Make the most of the holiday season in sales while not losing your sanity. Use our tips to help you plan ahead. 10 • Reduce your holiday hosting risk Here are a few important ways you can reduce your liability exposure as a holiday gathering host. Departments 10 2 • From the f irm | A season of giving… Here we are at the tail end of the year, which means that it’s time to get things wrapped up so you can breathe a little bit and enjoy this special season. This issue has tons of tips to help! 12 • Life and living | Milk and—something special—for Santa! Santa will soon be here! Check out our list of ideas for leaving him something a little different than the usual cookies. 14 • Mind f lex | Best holiday quiz ever! Take some time to challenge family, friends and coworkers to this 12 holiday quiz. You might even make it part of your holiday gatherings or use it as an ice breaker for the office party. Enjoy! Advantage is published by Rootworks LLC, 1516 S. Walnut St., Bloomington, IN 47401 (rootworks.com) and distributed as a courtesy by professional services firms nationwide. This publication is intended to provide general information only and is not to be construed as providing financial, legal, or other professional advice or services. The information and points of view presented may not be appropriate for your specific financial position or circumstances. Contact a financial or legal professional before making any decisions or plans regarding your financial management. NOVEMBER–DECEMBER 2019 | 3 Your guide to business gift etiquette 4 | NOVEMBER–DECEMBER 2019 ’Tis the season for generosity and showing others appreciation, which commonly means the giving of gifts. It can be tricky to know if it’s appropriate to give a client or a coworker a gift, and if so, what should you give? Here are some pointers to make sure any present you give (or receive) follows proper business etiquette… If your coworkers or clients For the most part, managers are from other countries, make sure you research usually only give gifts to those who work directly specific gift-giving customs. In some countries, on their team, if they desire to do so. An alternative business gifts are inappropriate, regardless of the might be to host a group lunch or dinner in lieu reason. In other countries, there are certain ways a of gifts. gift must be wrapped or presented. Taking the time to understand these customs will help you avoid Expensive gifts should never be potentially awkward situations for you and your given by an individual employee to their supervisor. colleagues or clients. If you are a supervisor and a direct report unknow- ingly chooses to give something that exceeds the When choosing gifts, try to normal range, such as a set of luggage or an expen- make them creative while avoiding anything too sive bottle of wine, it is up to the supervisor to personal or extravagant. Remember to check your graciously decline with a truthful explanation company’s gift-giving policy and that of your clients of why such a gift cannot be accepted. if you are unsure. In addition, the IRS has specific guidelines on the type and value of gifts that can be deducted at tax time. If you receive a gift yourself, be sure to practice proper etiquette and send a thank you note as soon If you are planning to give a as possible. The note can be brief, but it should be larger gift to a special coworker or your superior, unique to the gift received. you could take up a collection with your colleagues to purchase one nice gift instead of several smaller Happy giving! ones. If you do this, offer a suggested range and be sensitive to those who are unable to give. When it comes to giving gifts or throwing parties or office gatherings, all should occur during a time when everyone can participate. However, participation should not be mandatory. Gift giving and celebrations should always be optional in a business setting. NOVEMBER–DECEMBER 2019 | 5 Charitable gift giving Sometimes the gift of cash is better than anything you can put under the tree. However, with any monetary gift, it’s important to understand the tax rules. To help you out, we’ve compiled this brief overview to help you give wisely. (Note: Unless Congress acts before December 31, 2025, these rules will revert back to those in effect in 2017.) 6 | NOVEMBER–DECEMBER 2019 Be familiar with the • Use donor-advised funds. estate and gift tax These funds allow you to make a large contribution The lifetime estate and gift tax exemption was more in one tax year to establish or add to them. If it is than doubled under tax reform from $5.49 million large enough, you may be able to itemize deductions per person to an estimated $11.4 million per in- that year. In future years, if your deductible expenses dividual and $22.8 million for a married couple— are not large enough to itemize, you can request the with an inflation adjustment for future years. The donor-advised fund administrator to make a distri- annual gift exclusion amount remains at $15,000 bution to your chosen charity. for 2019 per recipient. • Consider gifts that return income. Keep in mind that if you live or own property in Starting a charitable gift annuity or a charitable states with state estate or inheritance taxes, where remainder trust can help you itemize in the year the non-taxable exempt threshold is much lower they are funded—while also receiving annual income than the federal exemption, you may still owe taxes. in the future. Keep in mind that only a portion of the contribution is deductible because the donor Have an income tax plan receives income for life or for a period of years. Before you give to charities or individuals, it is • Select donor-friendly assets. important to consider how doing so may impact Working with an investment professional can help your annual taxes. As you likely recall from last you choose the right assets for your charitable con- tax season, the personal exemption was eliminated tribution. Making sure you comply with all tax laws while the standard deduction was nearly doubled and don’t pay more than you need to on taxable to $12,200 for individuals and $24,400 for married gains is important. couples filing jointly. If you are a taxpayer who is • Know whether to choose charitable rollovers or 65 or older, blind or disabled, an additional $1,300 qualified charitable distributions. is available. If you are 70 ½ years old or older and required to Can’t itemize? Consider take minimum distributions from your retirement these giving options account, think about asking your plan administra- If you can’t itemize your deductions, these strate- tor to make a distribution directly from your gies can help you itemize periodically, reduce your account to a qualified charity. taxable income, or even return income to you: Although you won’t get an itemized deduction for • Bundling itemized deductions. that contribution, your favorite charity will get a If you have the flexibility to time the payment of nice gift. And the amount contributed out of your qualifying deductible expenses, you may want to RMD won’t be reported as taxable. consider bundling them into alternate years to This summary will help you start thinking about increase the likelihood of being able to itemize planning for the tax implications of charitable do- deductions. nations and cash or asset-based gifts. For assistance with your specific gift-giving situation this holiday season, please contact our firm. NOVEMBER–DECEMBER 2019 | 7 8 | NOVEMBER–DECEMBER 2019 The holidays can be hectic for business owners…unless you have an appropriate holiday strategy.