Washington is preparing to overhaul the tax code, by reducing and capping charitable deductions. This adjustment is encouraging many charitable, philanthropic donors and investors determined to give now – before the end of the calendar year arriving at midnight on December 31, 2012.
Today, I simply want to alert you to an immediate (and ending) opportunity regarding the current (higher) tax benefit regarding your donations made to tax deductible opportunities like WJU’s “University Fund (student scholarships),” and to respectfully ask you to make a ‘sizable year end gift’ to William Jessup University.
There are no politics to be played here; the decision to reduce charitable deduction rates is a bi-partisan decision.
Washington has been unrelenting in its attempts to limit the charitable deduction. During the presidential campaign both the president and the Republican challenger indicated that itemized deductions – including all charitable contributions to WJU – would be at risk in coming tax years.
The proposal has surfaced five times in the past three years. In a very telling comment, the May 2011 Congressional Budget Office “Options for Changing the Tax Treatment of Charitable Giving” report referred to charitable contribution deductions as “subsidies” because the costs represent foregone revenues to the federal government.
The proposed plan would limit the value of itemized deduction to 28% for couples with incomes of $250,000 or more and individuals with incomes of $200,000 or more. Recent studies have shown that a cap on the charitable deduction could result in loss of charitable giving of $2.9 billion to $5.6 billion each year.
Washington is also asking higher income earners to pay more in taxes come next year.
The new proposal states that every household with more than $1 million in annual earnings would be required to pay at least 30% of its income in taxes. This provision is known as the “Buffett Rule,” because of the complaint by the investor Warren Buffett that he pays less in taxes than his secretary does. The increased taxes ultimately reduce the amount that people who are millionaires and billionaires give to charity.
December is your last opportunity to contribute to the University Fund and invest through William Jessup University and receive your current, maximum tax deductions that have been offered since 2001 with the “Economic Growth and Tax Relief Reconciliation Act of 2001,” often referred to as the “Bush-era tax cuts.”
All of these changes, and their uncertainties, encourage one thing: major philanthropic donors, annual and capital partners considering (currently pledging) William Jessup University gifts might want to consider making those contributions now (this December), rather than waiting for Washington’s changes come 2013. I encourage you to consult your personal tax and wealth managers.
Two options for December through the WJU Development Office this December.
To make your tax deductible contribution to the University Fund (student scholarship fund) before December 31, 2012, please follow the secure process by visiting our secure online giving page. You can also mail your donation by using the WJU address at the close of this missive.
If you would like to discuss any major donations, pledges or endowments gifts, please contact me personally by calling (916) 577-1800.
Thank you for all you do to support William Jessup University, as we continue to “Transform Tomorrow … Today.”