Bay Area Estate And Tax Planning Law Firm

What does dive down into charitable contributions reveal?

On Behalf of | Jul 18, 2019 | Uncategorized |

The numbers are now in, and they paint “a pretty stark picture.”

So says a principal with Giving USA, a decades-old foundation that provides routinely relied-upon data relevant to charitable giving across the United States.

What Giving USA’s vice chair Laura MacDonald is especially concerned about is a material dip in giving since the massive federal Tax Cuts and Jobs Act was enacted in 2017. Research into relevant data has now been compiled and sensibly culled, and it reveals that individual and family giving in the U.S. is more than marginally down from past measuring periods.

In fact, total giving declined from an inflation-measured standpoint by 1.7% in 2018, the first full year in which the tax law’s new provisions took effect.

That is obviously concerning to everyone affected in any manner by giving. In America, that comprises a demographic of scores of millions.

What MacDonald and other commentators point to as being a prime driver of reduced giving is the recent legal change doubling taxpayers’ standard deduction. That spiked amount has put a damper on the number of people itemizing, which they must do to claim charitable deductions.

The on-point statistics linked with that reality are telling. They point to a drop from about 46 million itemizers to approximately 19 million following the recent tax law amendment.

That is precipitous, with MacDonald stressing that such a drop in giving among the country’s vast middle-and-lower income population “could prove problematic for non-profits in the long run.”

Tax laws in the United States are never static. Estate planners know that, appreciating that tax-linked strategies must be considered in tandem with other factors that can influence planning outcomes.

Questions or concerns regarding estate planning and related tax consideration can be directed to a proven professional commanding an integrated estate administration and accounting/tax background.