We deeply appreciate that our donors recognize a tax deduction is only one benefit of giving and derive incredible satisfaction from helping food-insecure families. Thank you for your commitment to the FoodBank’s mission to eliminate hunger in New Jersey.
In light of the recent Tax Reform Act passed by Congress, you may be looking at your finances and wondering how you will be impacted. This new legislation may affect the tax benefits of your 2018 charitable giving, particularly if you itemize today.
If you plan to itemize for 2017, you may consider making a larger or additional gift before the end of the year to realize the full tax benefit. In addition, it may make sense for you to accelerate some charitable contributions planned for 2018 into 2017 to get a larger income tax charitable deduction this year.
It’s not too late: To ensure you see a tax break this year when you itemize deductions on your income tax return, you must make your gift before December 31. Here are a few important things to keep in mind:
- Credit card: A last-minute gift can be made online to the Community FoodBank of New Jersey at cfbnj.org.
- Checks: If you plan to mail your gift, we recommend you send it via the U.S. Postal Service with a postmark on or before December 30 (the last day post offices are open).
- Securities: We recommend you initiate the transfer as soon as possible to allow time for processing and ensure the transfer is executed by December 29 (the last business day of the year).
If you feel you have maximized your giving for 2017, here are some alternative strategies to consider for 2018:
- Donate appreciated stock: With the stock market at or near an all-time high, give your appreciated stock to a nonprofit like the Community FoodBank of New Jersey and eliminate capital gains tax.
- Name the FoodBank a beneficiary of retirement plan assets: These assets remain taxable when distributed to a loved one. Avoid the tax burden by donating to our cause and/or other nonprofit organizations.
- Consider establishing a Donor Advised Fund: A donor who uses this strategy gets one large deduction the year he/she contributes to the DAF and can disperse distributions to the FoodBank and/or other charities over multiple years, maximizing your gifts and impact.
- Make an IRA charitable rollover gift (if you are 70½ years or older): Regardless of whether you itemize your taxes, this gift helps fulfill your required minimum distribution and is not considered taxable income.
- Talk with your tax professional: Please consult with your tax or financial advisor to determine the best charitable giving strategy for you.
The Tax Reform Act provides for lower tax rates, nearly doubles the standard deduction, and eliminates personal exemptions and almost all itemized deduction. Although the legislation maintains the income tax charitable deduction, some taxpayers may find the standard deduction better than itemized charitable deductions. Unfortunately, we believe the new Tax Reform Act is unlikely to benefit those we serve in a meaningful way. Additionally, we are deeply concerned that critical food and nutrition programs such as SNAP, WIC and school meals may be on the “cut list” for some members of Congress.
If you are interested in making a year-end gift to help FoodBank feed hungry New Jersey families today and in the year ahead, or if you have any questions about giving, please contact me at email@example.com or 908-845-8684 or our Major Gifts Officer Rachel Laibson at firstname.lastname@example.org or 908-355-3663 ext. 253. We will be happy to answer any questions or concerns you may have.
Thank you for all that your generous support provides on a daily basis and best wishes for a happy and healthy new year!
Vice President of Development
P.S. This New York Times article on Donor Advised Funds may be of interest to you as well.