The New Tax Law and Your Gifts to Austin College
We are pleased to update Austin College alumni and friends about the provisions affecting charitable giving within the Tax Cuts and Jobs Act of 2017. For those who will continue to itemize their deductions, the charitable deduction for cash gifts has expanded from 50% AGI (adjusted gross income) to 60% AGI, representing a 20% raise in the annual charitable deduction limit! We believe this change may benefit many donors, allowing them to make larger charitable gifts in the coming year. For gifts of property, the 30% AGI rule remains unchanged. Additionally, the new law repeals the Pease Amendment which phased out some of the benefits for itemized deductions, including charitable gifts for those with high incomes. Overall, charitable giving remains beneficial for most taxpayers.
Due to the expanded standard deduction, some of our alumni and friends will no longer itemize their deductions under the new law. Those who experience lower income taxes may realize increased discretionary income and this could be spent, saved, or donated to charity.
Donors considering charitable estate gifts will notice the new law includes no changes to charitable gift annuities, charitable remainder trusts, lead trusts, or other tax-qualified deferred gifts. Nor have any changes been made to the Charitable IRA Rollover provision which allows donors age 70 ½ and older to make qualified charitable distributions (QCD) from their individual retirement accounts which are excluded from income tax. This type of gift may in fact hold even greater attraction for older ‘Roos.
For donors wishing to make a charitable gift after their lifetime, the elimination of the federal estate tax for 99% of Americans will provide them with additional resources they could use to make philanthropic gifts.
We encourage you to consult with your tax, financial, and legal advisors before making charitable gifts. We look forward to speaking with you about your support of Austin College – your gifts matter here!
Suzanne Crouch, CFRE
Associate Vice President
Executive Director of Estate Planning
Austin College | Institutional Advancement