Two Ocean Charitable is a philanthropic program that allows individuals and families to make charitable contributions to a donor advised fund, receive an immediate tax deduction, and recommend grants to qualified nonprofits over time. Two Ocean Trust manages fund assets while The Community Foundation of Jackson Hole (CFJH) sponsors the fund.
Benefits of Two Ocean Charitable
Tax Advantages: Gifts made through Two Ocean Charitable may benefit from an immediate income tax deduction based on the full fair-market value of cash and securities at the time of the donation. Contributed assets are donated to CFJH, a 501(c)(3) organization, and tax deductible in the year the contribution is made, even if grants occur in future years. Tax deductions are subject to applicable gross income limitations but for donors realizing significant taxable gains in a year, contributions may be used to offset this income.
Donors who contribute long-term appreciated securities may receive a double tax advantage. While their deduction amount is based on the fair market value of the contribution, capital gains tax liability is eliminated on the unrealized gain, no matter how substantial.
Being strategic about when a charitable gift is made can lead to increased deductions. By
aggregating gifts in one year and itemizing a donor can increase available deductions.
Flexibility: Gifts made through Two Ocean Charitable allow donors more time to research and recommend grants. Once assets are in the fund, donors retain advisory privileges with respect to the distribution of funds. This flexibility allows donors to better plan their charitable giving and adjust as their philanthropic goals evolve over time.
Professional Investment Management: Gifts are held in a fund maintained by CFJH and managed by Two Ocean Trust; however, donors may recommend how the fund is invested -- allowing balances to potentially grow tax-free -- before recommending grants to charities. Two Ocean Charitable offers three investment options: Capital Preservation, Balanced, and Growth, with individually managed accounts available for funds over $1,000,000.
Digital Assets: Because bitcoin and other cryptocurrencies are relatively new to the marketplace, many nonprofit organizations are not equipped to accept these contributions directly. Thanks to Wyoming’s clear legal framework and Two Ocean’s status as a Qualified Custodian of digital assets, donors may deduct the appreciated value of their donated crypto without incurring capital gains taxes and invest the proceeds for future grantmaking.
Privacy: Two Ocean Charitable provides privacy for donors who wish to keep their philanthropic activities confidential. While grants themselves are publicly disclosed, the donor's identity can remain anonymous if desired.
Simplicity: Gifts made through Two Ocean Charitable allow donors to avoid the administrative burden of managing charitable trusts and private foundations as well as the reporting requirements associated with direct charitable giving. CFJH maintains and operates the fund, while Two Ocean Trust manages fund assets.
Tax Consequences of Contribution Types [1]
Cash: Income tax deduction is based on the amount of cash contributions to the fund. A donor may deduct up to 60% of adjusted gross income (AGI) in the tax year in which the contribution is made. Any excess tax deduction may be carried forward and deducted for five additional years after the year of the original contribution.
Long Term Appreciated Securities: For publicly traded securities that are held for more than one year, the tax deduction is based on the mean value of the securities on the deemed gift date. A donor may generally deduct up to 30% of AGI for gifts of long-term securities to the fund. Any excess tax deduction may be carried forward and deducted for five additional years after the year of the original contribution.
Short Term Appreciated Securities: For securities held for one year or less, the tax deduction is based on the donor’s cost basis on the deemed gift date. A donor may generally deduct up to 50% of AGI for gifts of short-term securities to the fund. Any excess tax deduction may be carried forward and deducted for five additional years after the year of the original contribution.
Conclusion
Two Ocean Charitable can be a powerful tool for achieving philanthropic goals. From tax advantages and flexibility in grant recommendations to professional investment management and the incorporation of digital assets, the program aligns with a wide range of donor needs and preferences. Our partnership with CFJH ensures expert grantmaking administration, allowing donors to simplify their giving process and focus on the impact of their philanthropy.
*****
About Two Ocean Trust
Two Ocean Trust was founded to serve private clients whose assets are multi-generational. We provide investment management and trust services to ultra-high net worth individuals, private family trust companies, and foundations. Based in Jackson Hole, Two Ocean Trust is uniquely positioned to provide access to Wyoming's tax advantages, modern trust laws, and enhanced privacy and asset protections.
Notes:
[1] Taxpayers should always consult a qualified accountant or attorney regarding the appropriate reporting of contributions to charitable organizations. Tax laws frequently change, and circumstances should be continually evaluated.
