Philanthropy–Looking Ahead 2018 – Tax Reform and Donor Impact
We deeply appreciate the generous individuals, business partners and foundations that supported our charitable mission in 2017. Together, we accomplished a lot last year. Charitable Subsidy, Senior University, the Wellness Program, the Point Defiance~Ruston Senior Center and the Where the Need Is Greatest Fund are sustained and develop due to the investment of donors. Looking ahead, we are excited about the year to come.
In the wake of recent tax reform, donors may be wondering about the impact on charitable giving in 2018 and beyond. Read more about impacts of the Tax Reform below.
Looking ahead, we are excited about the year to come. In the wake of recent tax reform, donors may be wondering about the impact on charitable giving in 2018 and beyond. While we know donors give first and foremost because they believe in our mission, we also know that tax deductions are a practical consideration for many people when making a gift. The bill nearly doubles the standard deduction from $6,500 to $12,000 for singles and $13,000 to $24,000 for couples. It is predicted that many more people will opt for the standard deduction now. However, if you continue to itemize, you can continue to take a charitable deduction. The final bill left the charitable deduction as the only primary deduction that was not limited or repealed entirely, and the benefits were actually expanded for some donors, particularly those making larger current and deferred gifts. If you have itemized in the past but might be considering taking the standard deduction in 2018, below are a few things to consider:
- There are special benefits of gifts of securities and other appropriate non-cash assets, especially if stock markets continue to trade at record levels. No capital gains tax is due when these gifts are made, regardless of whether you itemize your deduction.
- Donors 70½ and older with a qualified IRA who do not itemize deductions can continue to enjoy tax benefits from their gifts up to a total of $100,000 per year through an IRA Charitable Rollover (this can qualify as part of your mandatory withdrawal for the year).
- Donor Advised Funds emerged with no additional regulations. Donors may decide to start a donor-advised fund so they can deduct the full gift one year but distribute the money to nonprofit organizations over time. One of our nonprofit partners The Greater Tacoma Community Foundation offers donor-advised funds, as do a number of for-profit financial institutions.
- The tax treatment of charitable remainder trusts, charitable lead trusts, gift annuities and other split interest gifts has not changed.
- The overall AGI limitations for the deductibility of charitable gifts were expanded by 20%, raising the annual limitation from 50% to 60%.
- For those who will no longer itemize deductions because of the expanded standard deduction and other factors, many will find their overall income tax bill will be reduced under the new tax law and they will enjoy increased discretionary income that can be spent, saved or donated to charity – including Franke Tobey Jones!
Our Philanthropy Office looks forward to continuing to work with our donors in 2018 in order to carry on the important work of enriching and extending the quality of life for seniors in our community! You can contact us at https://www.franketobeyjones.com/give-volunteer/make-a-gift or at 253-752-6621.