Timing Is Everything

Richard Chute is The Planetary Society’s chief development officer.

The tradition of giving to charities like The Planetary Society at year’s end often brings up questions about how to make those gifts, as well as their tax implications.

A gift of cash is the simplest way to make a gift, and gifts may be sent to us in the form of a check via the mail (sent to my attenattention at 60 S. Los Robles Ave., Pasadena, CA 91101) or via a credit/debit card on our secure website at planetary.org/donate. While you are making your gift, we make it easy for you to see if you work for a company that will match it. Our confirmation page and email both include links to our look-up tool, which allows you to see if your employer participates. You may also check in advance by going to planetary.org/workplace.

For our members who are United States taxpayers, some changes were enacted in the Tax Cuts and Jobs Act of 2017 which impact when and how charitable deductions may be taken. The most significant change was the increase in the standard deduction to $12,000 for individuals and $24,000 for married couples filing jointly. Gifts to charities are deductible only if you itemize, so these increases will reduce the number of people who will qualify for charitable deductions, especially middle-income families.

While fewer people will benefit from deductions, the tax savings for donors who itemize will increase. The limit on the amount of charitable deductions that can be taken in a single year increased from 50 percent to 60 percent of adjusted gross income, and those who give more than 60 percent of their adjusted gross income may carry forward the excess contribution for an additional 5 years.

For U.S. taxpayers, there are other ways to make gifts to The Planetary Society. Members may want to consider a direct transfer of appreciated stock. This allows you to avoid the capital gains tax that occurs if you sell the stock and recognize the income from the sale.

For those who have individual retirement accounts and are over age 70.5, another taxwise method is to make a qualified charitable distribution. Gifts made this way allow you to avoid paying any tax on the income and also count toward your required minimum distribution up to a maximum of $100,000. If the new standard deduction levels mean you won’t itemize, this could be a sensible approach to making charitable gifts. We have also found that many of our members give through a donor-advised fund, which is a valuable tool for those looking to carefully manage their charitable giving.