Over the last several weeks our Planned Giving office has been inundated with questions from our donors about changes that are certain to come in U.S. tax policy.
While much remains murky at this time here's what we do know: There will be changes to capital gains taxes, estate taxes, and most likely additional limitations in the charitable deduction especially for high income earners. It appears the definition of a high income earner will be $200,000 of adjusted gross income for an individual and $250,000 for a married couple.
If you are concerned about losing your ability to fully deduct your charitable gifts next year we have a solution. Accelerate your charitable giving in 2012 because we know with certainty what the law says today.
The most efficient and stress-free method of doing this is to establish a Donor Advised Fund with Jewish National Fund.
What is a Donor Advised Fund?
A Donor Advised Fund (DAF) is a charitable giving account that allows you to make your charitable contribution this year, before December 31, and get the full charitable deduction. The DAF is structured in such a way that allows you to contribute today, invest the money in a manner that suits you, lets the money grow tax free, and then make grants to JNF and other charities in the future. That's right…receive all the tax benefits now, and then decide which charities you wish to support at a later date.
Let's look at an example:
Jodi and David earn in excess of $400,000 per year and support Jewish National Fund as well as other charitable causes. Like everyone else in their tax bracket they are hearing about new taxes and the limitations of certain deductions including the charitable deduction. They are rightly concerned that proposed changes will force them to reduce their charitable support. After a consultation with a JNF Planned Giving Specialist they decide to increase their charitable contribution this month to take full advantage of the current deduction.
They decided to create a JNF Donor Advised Fund to accomplish their dual goals of reducing their taxes and supporting their favorite charities and receive the following benefits:
• Full income tax charitable deduction in 2012
• Tax-free growth on the fund
• The ability to make grants from their Donor Advised Fund on their own timetable
• No more writing individual checks to various charities. A simple phone call or email to the Planned Giving Office and your contributions will be sent to JNF and other charities.
• Zero administration fees
The JNF Donor Advised Fund is a smart and tax-efficient way to manage your charitable giving. This year it makes more sense than ever.
Call a JNF Planned Giving Specialist at 800.562.7526 today or email plannedgiving@jnf.org for all of the details. We are here to help you.
Sincerely,
Matthew Bernstein
JNF Chief Planned Giving Officer