Resist ... by Donating
First of all, let me be clear:
Charitable donations to non-profit organizations are still 100% tax-deductible under the new tax code that was passed in late December 2017.*
(The difference is that the standard deduction was increased, so that — for many people — it may no longer be worth it to itemize these deductions, including charitable contributions. So, while your gift is still tax-deductible, that plus any other still-allowed deductions may total less than the new standard deduction, so it might not affect your taxes.)
For many of us, honestly, this will make little-to-no difference in our giving patterns. We give when asked (for instance, by a friend who asks us to support their cause), or because of expectation (church collection plate), when we support an organization or issue because it aligns with our core values (many of my clients), or when an situation really hits us and we feel compelled to do something (like donations to flood-related causes last spring). The fact that, come April 15, we get a little bit of extra reward from this in our tax return is a nice-to-have, but not a deal-breaker.
Others give so substantially that they WILL still be able to deduct these donations from their taxes, because their donations are well over the standard deduction. Sometimes these large donors give based on their asset base, rather than their annual income. Sometimes, they are just extremely generous — for example, a couple who is married filing jointly and who gives at a 10% rate and makes $250,000 a year would exceed the standard deduction. In other cases, I know of people who are bunching their giving (giving doubled or other donations every other year, so they can maximize their tax benefits in that year). Another way of doing this is to establish a donor-advised fund, where you could give large amounts to that fund and take the tax deduction at that time, and then disburse smaller gifts from that fund.
In our household, it's meant we're taking a look as to how we can do more with what we give. Beatrix already donates 25% of her allowance to causes she believes in, and we have just discussed making donations in her friends' names as part of her birthday presents to them. We have established a tradition of volunteering as part of our birthday activities (we volunteered at Second Stork for my birthday and Sheridan Story for Beatrix's), but in general we are trying to volunteer more regularly (more on that later). We're trying to be more conscious about donating things, such as outgrown clothes, to church clothing closets and other places that get them directly out, rather than just the easy Goodwill route (though we still do that on occasion, the easy drop-off is easy!).
But most of all, I'm now looking at donations as small — but meaningful — acts of resistance. It separates the gift from taxation and makes it 100% about your values. It's incredibly freeing to consider that your donation is 100% about impact and not necessarily about any personal benefit.
(which also makes me want to give more to places like Planned Parenthood, and other groups fighting the good fight).
* I am amazed, stunned even, that a great number of smart people I know, many of whom work for non-profits, did not know this, so don't feel bad if you thought they were no longer tax-deductible.
Charitable donations to non-profit organizations are still 100% tax-deductible under the new tax code that was passed in late December 2017.*
(The difference is that the standard deduction was increased, so that — for many people — it may no longer be worth it to itemize these deductions, including charitable contributions. So, while your gift is still tax-deductible, that plus any other still-allowed deductions may total less than the new standard deduction, so it might not affect your taxes.)
For many of us, honestly, this will make little-to-no difference in our giving patterns. We give when asked (for instance, by a friend who asks us to support their cause), or because of expectation (church collection plate), when we support an organization or issue because it aligns with our core values (many of my clients), or when an situation really hits us and we feel compelled to do something (like donations to flood-related causes last spring). The fact that, come April 15, we get a little bit of extra reward from this in our tax return is a nice-to-have, but not a deal-breaker.
Others give so substantially that they WILL still be able to deduct these donations from their taxes, because their donations are well over the standard deduction. Sometimes these large donors give based on their asset base, rather than their annual income. Sometimes, they are just extremely generous — for example, a couple who is married filing jointly and who gives at a 10% rate and makes $250,000 a year would exceed the standard deduction. In other cases, I know of people who are bunching their giving (giving doubled or other donations every other year, so they can maximize their tax benefits in that year). Another way of doing this is to establish a donor-advised fund, where you could give large amounts to that fund and take the tax deduction at that time, and then disburse smaller gifts from that fund.
In our household, it's meant we're taking a look as to how we can do more with what we give. Beatrix already donates 25% of her allowance to causes she believes in, and we have just discussed making donations in her friends' names as part of her birthday presents to them. We have established a tradition of volunteering as part of our birthday activities (we volunteered at Second Stork for my birthday and Sheridan Story for Beatrix's), but in general we are trying to volunteer more regularly (more on that later). We're trying to be more conscious about donating things, such as outgrown clothes, to church clothing closets and other places that get them directly out, rather than just the easy Goodwill route (though we still do that on occasion, the easy drop-off is easy!).
But most of all, I'm now looking at donations as small — but meaningful — acts of resistance. It separates the gift from taxation and makes it 100% about your values. It's incredibly freeing to consider that your donation is 100% about impact and not necessarily about any personal benefit.
(which also makes me want to give more to places like Planned Parenthood, and other groups fighting the good fight).
* I am amazed, stunned even, that a great number of smart people I know, many of whom work for non-profits, did not know this, so don't feel bad if you thought they were no longer tax-deductible.
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