Tax Bill Changes May Effect Year-end Giving
According to Bloomberg, “The Senate passed an $858 billion tax-cut plan Dec. 15 that would keep existing income tax rates for all earners through 2012. The House voted 277-148 for final passage even though many House Democrats wanted to limit the tax cut extension to the first $250,000 of family income. President Barack Obama is scheduled to sign the measure into law this afternoon.”
… For savers age 70 and a half and over, the tax bill includes a provision that allows them to give up to $100,000 from a traditional IRA directly to charity without incurring taxes.
In 2010, donors had to include the distribution as income and received a charitable income-tax deduction for their gifts. The bill would restore the exclusion from income retroactive to the beginning of 2010 and extend it to 2011 as well, said Kim Wright-Violich, president of San Francisco-based Schwab Charitable.
Here’s more from The Chronicle of Philanthropy:
“On her Twitter feed Friday morning, Diana Aviv, president of Independent Sector, praised the new legislation for extending unemployment benefits, cutting Social Security payroll taxes for nonprofit employees, and preventing wholesale tax increases in January. But she predicted that the measure would mean a “huge loss of revenue from many who will keep estate-tax benefits for themselves and not give to charity.”