Taxes

Donors may not understand how tax reform affects gift planning

Tax laws have changed, and many Americans are unaware of how these laws will affect them, according to a recent poll. Yet strategies still exist for getting the most out of your charitable giving this year.

Eighty-two percent of Americans who itemized charitable deductions on their 2017 tax returns plan to maintain or increase their giving this year, according to a survey released this week.

The poll also found that 58 percent of donors still planned to itemize in 2018, even though doing so may not be appropriate to their situations. This suggests many may not have fully worked out how the increased standard deduction in the revised tax code affects them.

For example, half of households with incomes of less than $100,000 currently plan to itemize their 2018 taxes, a survey recently showed. Most of these people will likely discover that their itemizations, including charitable donations, will not push the total deduction amount past the new standard deduction thresholds of $12,000 and $24,000.

The poll also showed that charitably inclined Americans are unaware of strategies to manage deductions, such as “bunching” – grouping multiple years of deductions into a single year in order to surpass the standard deduction.

Read the full story at ThinkAdvisor.
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