Although the 2017 revisions to the Internal Revenue Code known as the Tax Cut and Jobs Act (TCJA) preserved individuals’ itemized income tax charitable deduction, other changes made the standard deduction the best option for most individual taxpayers. If experience is a good indicator, individuals will continue to give to charity whether or not they receive a tax benefit, but they may give less than in prior years. Because charitable giving offers a tax benefit to those who will itemize their deductions, and most itemizers will be high-net-worth taxpayers, charitable giving continues to be an important component of the overall income tax plan for many high-net-worth individuals. With the significant reduction of other deductible expenses under the TCJA, charitable donations may play an even more important role in tax planning for high-income taxpayers. Anecdotally, many charities are reporting that their wealthier patrons are increasing their giving to cover the expected gap resulting from the increased standard deduction.  Although statistics are not yet available, we predict the 2018 data will show that wealthier taxpayers increased their charitable giving.

To maximize the tax advantage of charitable gifts, donors must consider what to give, when to give it, and to what type of charity the gift should be made.

What to Give

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