‘Month of Giving’: Is it time to review philanthropy plans?

November is known as the month of giving. The reason for that is shrouded in history and tradition, but that does not diminish the fact. What makes this year different from years past, though, is that it is the first November since Congress enacted massive tax reforms.

While some research suggests the reforms aren’t triggering donors to make any significant changes in giving plans, observers say it also indicates many taxpayers may not fully appreciate the implications that tax changes could have on their personal wealth and estate management plans or be aware of planning strategies available to help them meet their giving goals and achieve the tax advantages they expect.

The dilemma

According to a recent survey by Fidelity Charitable, a full 82 percent of respondents plan to keep giving at current or higher levels this year as a way to give back or bring about change. Meanwhile, experts are estimating that tax reform changes will cut the number of people eligible to itemize deductions from 46 million to just 19 million. That’s because of the standard deduction for married couples filing jointly is significantly higher and so is the threshold amount that must be met to allow itemized deductions.

Still, the majority of donors polled said they plan to itemize deductions this year, including many whose income isn’t likely to make itemization feasible. That leads some experts to conclude that taxpayers are entering this month of giving rather blind to the tax realities.

Managing the change

A variety of different strategies do exist to maximize planned giving and maintain tax advantages, even under the current reform scenario. Finding one most appropriate for you depends on your specific circumstances as assessed by an experienced tax law attorney. Perhaps the time is right to conduct such a review.

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