Tax Cuts and Jobs Act
Strategies for Giving in 2021
New Giving Opportunity for Non-Itemizers.
If you do not itemize deductions, you may nonetheless take an "above-the-line" deduction for up to $300 in cash gifts you make to The Hotchkiss School.
Only contributions actually made during 2020 qualify. In other words, any excess cash contributions carried over from prior years are not eligible for this one-time, "above-the-line" deduction.
Many people are wondering, for charitable gifts, what do I do in the face of the changes that the Tax Cuts and Jobs Act makes to individual and business income tax, as well as the estate tax?
Itemize, give stock, and make sure that you are talking to your advisors and us about supporting Hotchkiss through the best giving vehicles for you!
First, the new tax law still allows you to deduct charitable gifts and raises the cash gift deduction ceiling to 60%* of your adjusted gross income. While the law is intended to reduce your incentive to itemize by increasing the standard deduction, (for single filers, the standard deduction jumps to $12,000; for married couples filing jointly, $24,000), it also reduces many people's deductions for mortgage, real estate and state and local tax deductions.
*100% for 2020. See CARES Act.
That means that charitable gifts may be even more beneficial for many people to balance their tax burden with their take-home income, especially giving through one's retirement plan.If you are facing uncertainty as you approach giving in 2021, let us help!
Gifts of appreciated stock allow you to continue to support our mission, avoid capital gains taxes, avoid additional income tax, and still receive credit for a charitable gift.
Have you thought about gifts that give back to you? A Charitable Gift Annuity with us allows you to fund your retirement, receive a large tax deduction this year (and for up to five additional years) while receiving tax advantaged income to you (and a spouse or partner) for the rest of your life.
Finally, a simple bequest allows us to continue to do the work you love for years. Ask us how a bequest, or beneficiary designation gift today can make your impact last forever. A retirement plan beneficiary designation gift is easy, doesn't require an attorney to accomplish and allows you to leave other assets to your loved ones without the tax implication of leaving your IRA to them.
What's best? It is a gift that costs nothing during your lifetime!
For more information, please contact us and we will be glad to assist you.
Planning your estate and legacy for future generations, including your charitable interests, takes careful evaluation. I am here to help and will gladly discuss your needs, goals, and possible gift options.