Make your FY18 PC donation by Dec 31 because

[Sean Miller Fan]

With the GOP tax bill looking like it will pass, you will no longer be able to write-off charitable contributions for anything. This is because you had to itemize to take the charitable deduction, but now only 1%-4% of people will itemize under the new plan because the standard deduction is doubled and you cannot deduct state and local taxes on Schedule A. So, basically you have to be donating lets say $15K per year and paying $10K in mortgage interest (total of 25K in itemized deductions) to itemize and as I said, hardly anyone will do that.

This is not meant as saying I am for or against the plan. Just stating a fact: Get your donations in before Dec 31 because if you donate Jan 1 or after, you just have up a refund of 25% or whatever your tax bracket would have been

 

[Jakey_John]

This is Locker Room material.

 

[Sean Miller Fan]

This is Locker Room material.

No it isn't. Anyone planning on making a donation in relation to football season tickets or whatever is best to do it by Dec 31 for tax purposes. Just trying to be helpful.

 

[Jpripper88]

With the GOP tax bill looking like it will pass, you will no longer be able to write-off charitable contributions for anything. This is because you had to itemize to take the charitable deduction, but now only 1%-4% of people will itemize under the new plan because the standard deduction is doubled and you cannot deduct state and local taxes on Schedule A. So, basically you have to be donating lets say $15K per year and paying $10K in mortgage interest (total of 25K in itemized deductions) to itemize and as I said, hardly anyone will do that.

This is not meant as saying I am for or against the plan. Just stating a fact: Get your donations in before Dec 31 because if you donate Jan 1 or after, you just have up a refund of 25% or whatever your tax bracket would have been

This isn't bad advice, but you keep over exaggerating this issue. Lots of the donors would still itemize under the new tax plan. Lots of middle class folks won't, under the new tax plan. Most middle class folks aren't donating to ADs.

There are plenty of other reasons why people would itemize deductions beyond just mortgage interest and charitable donations. This is especially true for the self employed or many high commission dependent careers, who deduct work and career expenses. And, of course, those folks have a much higher likelihood of being high earners, who might donate significant dollars to ADs.

Of the people making close to significant donations, don't you think many are paying $10k+ on mortgage interest? If you are able to make a $10k per year donation to Pitt, I'm going to pretty much guarantee you have a home worth at least $500k and so you are likely paying at least $15k in mortgage interest. For a lot of folks we are talking about $20k in mortgage interest, especially in Pitt's donor base areas where home prices are very high. That is before any other itemized deductions. If state and local taxes stay in the plan, this isn't even close to an issue.

 

[paulbl99]

Anybody taking tax planning advice from SMF is off their nut.

Just sayin

 

[Sean Miller Fan]

With the GOP tax bill looking like it will pass, you will no longer be able to write-off charitable contributions for anything. This is because you had to itemize to take the charitable deduction, but now only 1%-4% of people will itemize under the new plan because the standard deduction is doubled and you cannot deduct state and local taxes on Schedule A. So, basically you have to be donating lets say $15K per year and paying $10K in mortgage interest (total of 25K in itemized deductions) to itemize and as I said, hardly anyone will do that.

This is not meant as saying I am for or against the plan. Just stating a fact: Get your donations in before Dec 31 because if you donate Jan 1 or after, you just have up a refund of 25% or whatever your tax bracket would have been

This isn't bad advice, but you keep over exaggerating this issue. Lots of the donors would still itemize under the new tax plan. Lots of middle class folks won't, under the new tax plan. Most middle class folks aren't donating to ADs.

There are plenty of other reasons why people would itemize deductions beyond just mortgage interest and charitable donations. This is especially true for the self employed or many high commission dependent careers, who deduct work and career expenses. And, of course, those folks have a much higher likelihood of being high earners, who might donate significant dollars to ADs.

Of the people making close to significant donations, don't you think many are paying $10k+ on mortgage interest? If you are able to make a $10k per year donation to Pitt, I'm going to pretty much guarantee you have a home worth at least $500k and so you are likely paying at least $15k in mortgage interest. For a lot of folks we are talking about $20k in mortgage interest, especially in Pitt's donor base areas where home prices are very high. That is before any other itemized deductions. If state and local taxes stay in the plan, this isn't even close to an issue.

I agree with a lot of what you say. The "big wig" donors will still be able to itemize. I am assuming most people on this board are not "big wigs." As I said, 1%-4% will itemize. If you are not a "one percenter" or close to it, there's a very strong chance that you're itemizing days are over. Not that that's a bad thing because you should be paying less in taxes overall, you just won't have the extra "incentive" to donate after this year. So, get yours in soon.

 

[LivinWell]

I made mine today and I usually make it in June. Many many high income earners own their homes therefore no interest deduction.

 

[Jpripper88]

I agree with a lot of what you say. The "big wig" donors will still be able to itemize. I am assuming most people on this board are not "big wigs." As I said, 1%-4% will itemize. If you are not a "one percenter" or close to it, there's a very strong chance that you're itemizing days are over. Not that that's a bad thing because you should be paying less in taxes overall, you just won't have the extra "incentive" to donate after this year. So, get yours in soon.

I am not talking about big wigs. You live in the NY/NJ area and have a combined income of $250k and a $400k (lets say 4% rate) mortgage (it would be a pretty modest home in all likelihood). You are no where near a 1%er or making enough to be donating all that much to a college AD, but you are at $16k just in mortgage interest before any other itemized deductions. Add property taxes and you are probably talking another $7k+. You are already at $23k of the $24k before the charitable or any other deductions. And this is a very low end, basic donor profile, who probably isn't donating all that much.

 

[Sean Miller Fan]

I agree with a lot of what you say. The "big wig" donors will still be able to itemize. I am assuming most people on this board are not "big wigs." As I said, 1%-4% will itemize. If you are not a "one percenter" or close to it, there's a very strong chance that you're itemizing days are over. Not that that's a bad thing because you should be paying less in taxes overall, you just won't have the extra "incentive" to donate after this year. So, get yours in soon.

I am not talking about big wigs. You live in the NY/NJ area and have a combined income of $250k and a $400k (lets say 4% rate) mortgage (it would be a pretty modest home in all likelihood). You are no where near a 1%er or making enough to be donating all that much to a college AD, but you are at $16k just in mortgage interest before any other itemized deductions. Add property taxes and you are probably talking another $7k+. You are already at $23k of the $24k before the charitable or any other deductions. And this is a very low end, basic donor profile, who probably isn't donating all that much.

Property taxes will no longer be deductible. So, if you have a 400K mortgage paying 16K per year in interest, you would have donate more than 8K per year to non-profits to be able to itemize assuming you are married filing jointly.

As I said, it would be extremely rare to be in a situation where you could itemize, 1%-4% of the population, down from around 30%. So it would probably be the best move for most people to get 2-3 years worth of donations in before Dec 31 so you can count them all this year

 

[Jpripper88]

Property taxes will no longer be deductible. So, if you have a 400K mortgage paying 16K per year in interest, you would have donate more than 8K per year to non-profits to be able to itemize assuming you are married filing jointly.

As I said, it would be extremely rare to be in a situation where you could itemize, 1%-4% of the population, down from around 30%. So it would probably be the best move for most people to get 2-3 years worth of donations in before Dec 31 so you can count them all this year

Actually we don't know that yet and we don't know if state and local taxes will be allowed to be itemized. The House plan includes the property tax deduction, which would make itemized deductions still extremely prevalent in the NE and Pitt's donor bases. The Senate plan includes medical expenses as a deduction.

It will not be extremely rare. Many of the same people who donate to ADs and itemized will still be itemizing. Why? Because people donating significant amounts of money to ADs are high income earners who have higher mortgages and thus mortgage interest. If state and local taxes or property taxes are included, this is a no brainer.

The difference in the previous and the new standard deduction is only $3600. There are very few who would be making sizable donations (especially with the responsible means to make "2-3 years worth of donations" in the next month) who weren't already eclipsing that extra $3600, easily.

I think this tax bill is going to be ridiculous and irresponsible, but ADs aren't going to see much if any difference in donations because of it and the donors who previously itemized deductions are almost universally still going to be itemizing. Your concern is mostly with/for (actual) middle class taxpayers, who earn far less money than those who are able to donate thousands of dollars per year to a University AD.

 

[Sean Miller Fan]

Property taxes will no longer be deductible. So, if you have a 400K mortgage paying 16K per year in interest, you would have donate more than 8K per year to non-profits to be able to itemize assuming you are married filing jointly.

As I said, it would be extremely rare to be in a situation where you could itemize, 1%-4% of the population, down from around 30%. So it would probably be the best move for most people to get 2-3 years worth of donations in before Dec 31 so you can count them all this year

Actually we don't know that yet and we don't know if state and local taxes will be allowed to be itemized. The House plan includes the property tax deduction, which would make itemized deductions still extremely prevalent in the NE and Pitt's donor bases. The Senate plan includes medical expenses as a deduction.

It will not be extremely rare. Many of the same people who donate to ADs and itemized will still be itemizing. Why? Because people donating significant amounts of money to ADs are high income earners who have higher mortgages and thus mortgage interest. If state and local taxes or property taxes are included, this is a no brainer.

The difference in the previous and the new standard deduction is only $3600. There are very few who would be making sizable donations (especially with the responsible means to make "2-3 years worth of donations" in the next month) who weren't already eclipsing that extra $3600, easily.

I think this tax bill is going to be ridiculous and irresponsible, but ADs aren't going to see much if any difference in donations because of it and the donors who previously itemized deductions are almost universally still going to be itemizing. Your concern is mostly with/for (actual) middle class taxpayers, who earn far less money than those who are able to donate thousands of dollars per year to a University AD.

The House bills allows property taxes to be deducted. The Senate bill does not. Neither allows state and local income to be deducted.

I think what you aren't understanding is the majority of Pitt donors are not "wealthy." Now, I am sure wealthy donors make up the majority of dollars donated. But in terms of actual individual donors, I am sure the majority are middle class or upper middle class making more modest donations. So these posts are directed at those folks, which I am guessing are most of the folks on this board. I don't sense a lot of neurosuegeons or hedge fund managers on here.

I do agree that if you are wealthy, this new tax bill is extremely faborable to you and it doesn’t matter in what year you do your donation

 

[Jpripper88]

The House bills allows property taxes to be deducted. The Senate bill does not. Neither allows state and local income to be deducted.

I think what you aren't understanding is the majority of Pitt donors are not "wealthy." Now, I am sure wealthy donors make up the majority of dollars donated. But in terms of actual individual donors, I am sure the majority are middle class or upper middle class making more modest donations. So these posts are directed at those folks, which I am guessing are most of the folks on this board. I don't sense a lot of neurosuegeons or hedge fund managers on here.

I do agree that if you are wealthy, this new tax bill is extremely faborable to you and it doesn’t matter in what year you do your donation

I didn't even begin to discuss wealthy people.

Do you know what the middle class American family makes? $40k-$118k for a household and median of $59k. So the average family of 4 is AT BEST making $118k pre tax. Almost none of those people have money to donate to an athletic department. Those people are struggling to pay their bills and MAYBE save for their retirement and college for the kids. They certainly don't have the means to make several thousand in donations and REALLY can't afford to make 2-3 years of donations ahead of time.

A family making $250k a year (anywhere, but especially) in the NE isn't remotely close to wealthy.