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    Dripping Springs Community Foundation President Susan Santamaria. CENTURY NEWS PHOTO BY JOHN PACHECO

END OF YEAR GIVING STRATEGIES

NON PROFITS

Last year’s tax law sharply reduced the number of people who get deductions for charitable contributions, and some charities are concerned about how it may affect the busy Christmas/end of year donation season. The new standard deduction is $12,000 for individuals and $24,000 for married couples, which may reduce federal taxes, but may also discourage tax payers from itemizing. The result being more people may take the standard deduction, as opposed to itemizing—and in so doing, may lose a large incentive for giving. “In the past, when there was going to be some impact on charitable deductions, and deductions overall, charitable donations increase just before the change. So, in 2017 we saw quite a large increase prior to tax reform taking effect in January of 2018. In short people wanted to take advantage before the deductions changed,” Dripping Springs Community Foundation President Susan Santamaria said. “Fortunately, over time, that more or less adjusts itself.” Santamaria says that organizations like the Dripping Springs Community Foundation may still be able to help people plan and execute charitable giving in a way that maximize their tax benefit. “One of the potential strategies an organization like the Dripping Springs Community Foundation may help with is setting up a donor advised fund,” Santamaria said. “The donor gives a larger one-time large lump [which gets them over the itemized deduction threshold], but they don’t actually have to give the money out immediately to the end-receiving beneficiaries. [Rather] the money can be judiciously given out over a series of years, and they get to direct what charities get the money. That’s why it’s called a donor advised fund. So for example, in 2019 they may decide to give money to Helping Hands, in 2020 they may decide to give money to the Friends Foundation, in 2021 maybe someone else.” Santamaria also mentioned that there are also other potential strategies involving people with retirement accounts who may be facing mandatory distributions. “The Dripping Springs Community Foundation serves all the non-profits that serve the greater Dripping Springs area. Our purpose is to promote philanthropy in the community and to provide support through education, leadership, and shepherding young non-profits who are growing, or who may not yet have their own 501c3 yet,” Santamaria said. The foundation welcomes inquiries from both donors and area charities looking to build sustainable strategies. For more information on the Dripping Springs Community Foundation, visit: http://www.dscommunityfoundation.org.

Dripping Springs Century-News

P.O. Box 732
Dripping Springs, Texas 78620

Phone: (512) 858-4163
Fax: (512) 847-9054