Personal Planning Ideas

Planned Giving

  • Standard Deductions Take Giant Leap

    As a result of increased standard deduction amounts for 2018, only about 5% of taxpayers will likely itemize in future years — down from about 30% in prior years.  For 2018, the deductions are as follows:

    Single taxpayers
    $12,000
    $13,600 (if age 65 or older)
    $13,600 (if blind)
    $15,200 (if age 65 or older and blind)

    Married taxpayers
    $24,000
    $25,300 (if one spouse is age 65 or older)
    $26,600 (if both spouses are age 65 or older)
    $25,300 (if one spouse is blind)
    $26,600 (if both spouses are blind)
    $29,200 (if both spouses are age 65 or older and blind)

    The deduction for home mortgage interest is now limited to interest on only up to $750,000 of indebtedness for first and second homes; the deduction for state and local taxes is capped at $10,000; deductions are gone for miscellaneous itemized expenses subject to a 2%-of-adjusted gross income threshold and for work-related moving expenses; unreimbursed casualty losses are restricted to disasters declared by the President. 

    Charitable contributions are still deductible, and in fact, the limit for cash gifts is increased from 50% of adjusted gross income to 60%.  Bunching several years’ worth of gifts into one year may enable some donors to exceed the standard deduction.  Another option is to fund life-income gifts (charitable remainder trusts, charitable gift annuities) to generate a larger deduction while retaining payments for life from your gift.

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