Xerxes Mullan, Founding Partner at Avestar Capital, firmly believes in the
saying, "To whom much is given, much is expected." This means that
we are held responsible for what we have. If we have been blessed
with a unique talent, abundant wealth, knowledge or time, we are
expected to benefit others from the same.
At Avestar
Capital we work with several non-profits across the client
networks. The aim is to have clients who can take advantage of
each other's balance sheet for philanthropy and giving. This
network effect is exponential as other like-minded individuals
will tend to possess similar principles.
In the United
States, financial advisors should report their business and
individual incomes on similar tax forms as all other small
business owners. Those who function as sole proprietors must
report all business income and expenditures on Schedule C, while
others must file partnership or corporate tax returns. Income is
taxed at the federal, state, and regional levels, and earned
income is subject to additional taxations to fund Social Security
and Medicare, to name some. Tax benefits can be accrued through
charitable giving.
Two of the most-liked charitable
vehicles are donor-advised funds and private-owned foundations. As
with direct giving, they can both provide a tax deduction to
offset a huge income tax year following the sale of, for example,
a business, investment assets, or real estate. Private foundations
require a 5% annual distribution. Some advantages to this could be
tax-free growth of assets earmarked for charity and accumulation
for strategic deployment and involvement of other family members,
including younger generations, in decisions about giving. It will
also give a legacy of charitable giving long after death. The
deduction limit for contributions of long-term capital gains
property usually is 30% of your adjusted gross income (AGI). The
team at Avestar Capital can advise on investment strategies and
prudent investment rules to ensure a tax-smart approach.
Foundations are a great way to build a family bond
around giving an even better way to include children in wealth
creation as well. Encourage children between the ages of 12-16 to
set aside a portion of allowances and monetary gifts to be donated
to charity, and at the end of the year help them or select a cause
they support to which the funds will be given. This process can be
as formal and easy as setting aside a separate bank account and
soliciting informational packets from local non-profits, or as
informal as purchasing a divided piggy bank or rinsing out an old
coffee can. Being involved in the process of giving will help your
offspring feel invested in the causes he or she chooses, giving
them a better understanding.
Make your offspring aware
of the processes that are crucial to your family's philanthropy,
whether it be the attendance at annual board meetings, grant
proposal review, and decision-making, or a whole different range
of activities. How you interpret and respond to the duties and
activities related to your philanthropy will anticipate the way
your child views his or her near future responsibilities. Discuss
your hopes for your children's involvement in your philanthropy
and listen to your children's philanthropic aspirations to get to
know their mindset.
It's often said that children
learn by example and from what they see, and the greatest way to
make sure that charitable donation is a significant and valued
part of your children's lives is to ensure that it plays a crucial
role in your own life. Make sure that your children understand not
only the charitable tasks, duties, and responsibilities that you
and your family take on but also the joy and deeper meaning you
derive from these things. Share your experiences with them when
things go as you anticipated and share the lessons or learnings
you have gained when things don't turn out as you'd expected or
planned. Look at the impact that your role has had in shaping, or
reshaping, your family's philanthropic legacy and examine/study
the path you chose to arrive where you are now. And look forward
to discovering the paths your children will take or plan to take,
and how their talents and enthusiasm will help that legacy grow
further and evolve. This will also help mold your children to be
fiscally responsible and know ways of life.
A big
pillar of Avestar Capital is philanthropy because Xerxes Mullan
himself is an outcome of philanthropy. He aims for this to be
ingrained completely in the values of the firm and aims to work
with clients who want to give back to the community and make a big
impact on the community.