The recent tax bill passed by Congress and signed by the President is generally being referred to as the Tax Cuts and Jobs Act of 2017 and makes some sweeping changes in income tax laws. The intent of this letter is simply to educate you on one aspect of its impact on charitable giving (this is not intended as legal advice applicable to your specific situation). Please ASAP consult your tax advisor on this issue.
The standard deduction is going up. If you have itemized deductions in the past, the new higher standard deduction may be better for you in the future. For a married couples filing jointly, you would have to have more than $24,000 (adjusted for inflation) in itemized deductions to do better than taking the standard deduction.
Charitable giving deductions are part of your itemized deductions. If you think that your itemized deductions for 2018 and then next 7 years (this rule is only temporary) will be less than the standard deduction, then please remember that charitable giving will not benefit you from an income tax standpoint during those years.
This year, the standard deduction for a married couple filing jointly is $12,700. If you think that your itemized deductions for 2017 will exceed the standard deduction, then you may want to consider making some of the charitable donations you would have considered doing in 2018 and beyond right now. If you make them on or before December 31, you can put them on your 2017 income tax return and get the benefit of the deduction. If you wait and make the donation on January 1 or later, the new, higher standard deduction may cover up all of your itemized deductions so that they don’t produce the income tax impact that they would in the next few days.
I hope this helps.