While the end of the year is not quite here yet (but rapidly approaching), now is an opportune time to take a moment and start your year-end tax planning for 2018. This is particularly necessary this tax year because of the changes to the tax law that became effective in 2018. As a result of […]
Under the Tax Cuts and Jobs Act of 2017 (the Tax Act), it is estimated that fewer than 10% of Americans will itemize on their income tax returns. However, you only receive a deduction for charitable giving if you itemize. Therefore, the vast majority of Americans will not benefit from a charitable deduction under the Tax Act.
One option for those who are charitably inclined is to “bunch” charitable deductions together and to itemize every two or three years. This can be done via a large gift directly to the charity, prepaying a pledge for the following year, or, if you would like to have the ability to decide when and how to make the contributions in future years, through a gift to a donor advised fund.
“The Tax Cuts and Jobs Act makes sweeping changes to the tax code, but few directly impacting retirement benefits.”
Now that the new tax law has passed, it is time to consider how it will affect your retirement benefits. The new law eliminates Roth recharacterizations and may make qualified charitable distributions even more popular, according to Natalie Choate in “What the Tax Cuts and Jobs Act Means for Retirement Benefits.”
