By Sandi Scannelli

If you did not know it last year, you’ll soon learn that you may not be able to deduct your 2018 charitable contributions — unless you exceeded the new higher standard deduction and are able to itemize. For a married couples in 2019, the standard deduction rises to $24,400 of allowable deductions and $12,200 for individuals! We do not make contributions solely for the tax deduction, but let’s face it, it kind of gives us a warm glow to know we are reducing our taxes. I liken it to buying something I need and then finding out it is on sale! YAY!

Americans have been able to deduct charitable gifts since 1917. It was part of the War Revenue Act of 1917 because there was a concern that charities would not survive the war. Over the years, the charitable deduction for those itemizing has been commonly viewed as an incentive to donate. Now that the standard deduction has nearly doubled, many fear that charities will suffer deeply because fewer individuals have the incentive to be charitable. Time will tell. We may not see the full impact until 2019 after everyone prepares their 2018 tax return and experiences the 2018 tax law change. Does this mean taxpayers will stop giving? I cannot imagine it. We’re “wired” to give. American history illustrates deep and wide philanthropy — long before we ever had a tax incentive.

There are still ways to make a contribution and reduce your taxable income. But first, let me clarify, this is not tax advice. Rather, consider this article your friendly reminder to talk to your professional tax advisor this month so you can plan differently for 2019. As an example, if you are 70½ and have a qualifying IRA, you can donate up to $100,000 of your RMD (Required Minimum Distribution) directly to a charity and the amount donated is not considered taxable income. Another example has been called “bundling” where you bundle a couple of years of your normal charitable giving, set up a named fund at the community foundation and the foundation distributes your charitable gifts over the time period you define to the organizations you choose. The “bundled” gift amount may put you over the standard deduction and, presto, you can now itemize and deduct the bundled amount in the year you made the gift! YAY! You’ll only get the deduction in the year you make the bundled gift, but your charitable gifts can continue over several years. You can now see why consulting a tax professional and careful planning is important.

Talk to your tax adviser. They will provide the best tax advice for your financial goals and circumstances. Then, we hope you’ll come talk to us about how to set up a charitable fund and a plan that continues to benefit the charities you choose.

Happy 2019, the last year of the decade. Plan well and make it a “YAY” year!

Sandi Scannelli is president of the Clemmons Community Foundation.