We are less than a month away from the deadline to file your 2017 taxes. Although nothing changes for this year’s return, the Tax Cuts and Jobs Act (TCJA) brings significant changes to 2018 tax returns and these changes may impact giving to your nonprofit.
The changes will be in place for our 2018 taxes; right now, the 2017 tax season, is a good time to begin educating your donors (and your board and staff) about the new law for more effective tax planning.
Charitable gifts are still deductible under the new law, if the tax payer chooses to itemize deductions. The law doubled the standard deduction to $12,000 for single filers and to $24,000 for married, filing jointly. Along with this increase, the law reduces or eliminates many other deductions.
In a nutshell, it is a disincentive to itemize for many tax payers, which may result in fewer contributions to your nonprofit.
There are many other provisions of this new tax law that nonprofit staff and board should learn. There is also a wealth of resources. Starting your learning process now and share that with donors throughout the remainder of 2018. This will help your nonprofit and your donors be ready for next year’s tax deadline.
Resources
Association of Fundraising Professionals summary document.
Read more from an attorney’s perspective here:
https://www.nolo.com/legal-encyclopedia/gop-tax-bill-and-impact-on-nonprofits.html
Checklist for Nonprofit Staff and Board Members:
https://www.councilofnonprofits.org/sites/default/files/documents/tax-law-checklist-nonprofits.pdf.
