Planned Giving News Magazine

The following is intended as general information and does not represent legal or tax advice. Individual circumstances vary - please consult your legal and tax advisors about your specific situation. As a monthly news source, some information may remain on this page for several weeks.

NEWS SOURCES | ARCHIVES OF PAST MONTHS

Child Tax Credit and Marriage Penalty Tax Breaks Extended - 9/24 -"Fearful of being attacked as supporters of higher taxes, Democrats said they would go along with an unpaid five-year extension of the $1,000 child tax credit; a four-year extension of tax breaks intended to reduce the so-called marriage penalty on two-income families; and a six-year extension of a provision that allowed more people to qualify for the lowest tax rate of 10 percent."

Being Extended
$1,000 child tax credit, through 2009
Expanded 10% tax bracket, through 2010
Alternative minimum-tax relief for 1 year
Marriage penalty relief, through 2008
23 business tax credits for 1 year

cost (billions)
$61.6
$29.4
$22.6
$15.7
$13.0

New York Times and Washington Post

Interest Rates - 9/13 - "If the Federal Reserve raises interest rates next week as expected, it will be nearing completion of the first stage of what appears to be a two-stage campaign to return interest rates to normal levels," the Wall Street Journal reports. "In the first phase, the Fed is moving to quickly raise the federal-funds rate target from the 'emergency' level of" 1 percent, "where it stood for a year through June and was the lowest in 46 years."
GovExec and Wall Street Journal

Bipartisan Panel on Tax Reform - 9/11 - The White House has released the goals for the Bipartisan Panel on Tax Reform. In doing so, it also noted problems with the current tax code.

Bush Reiterates Call for a Simpler Tax System 9/5 -- President Bush reasserted his call Sunday for a simpler tax system, and aides said he is considering pushing for a flat tax, which would set the same income-tax rate for most taxpayers, as a major priority if he were to win a second term. In arguing for a rewrite of tax laws, Bush said that they are "a complicated mess" and "full of special-interest loopholes "Americans spend about 6 billion hours of paperwork and headache every year on the tax code," he said. "In a new term, I will lead a bipartisan effort to reform and simplify and make fair the federal tax code."
Washington Post

Five Tips for Raising Charitable Children
Teach Kids to Care about Their Local and Global Neighbors (ARA) - Every day, American children are inundated with messages about must-have toys, computer games, designer-label apparel, and more. In a 'me-centered" culture, it can be quite a challenge to educate children about the needs of the less fortunate in our neighborhoods and around the world. Making charitable giving a priority can bring children a new awareness of the world and their place in it, and can instill a sense of gratitude and appreciation for what they have. Here are five recommendations for raising charitable children:

1. Expect your children to give. Set the giving standard and see if they don't rise up to meet it. Children of all ages typically respond well to reasonable yet challenging expectations.

2. Show them what and where you give. Some people will find this difficult because we were taught from a young age to be very private about our giving. However, mentoring means modeling. Talk about why you give and how you chose the organizations.

3. Match their giving. When you match your children's giving, you begin to understand what touches their hearts and they discover that you value these things.

4. Take them with you on visits to charities. You may be surprised how much children learn just from being with you in any visits you make to charities. Being exposed to the work can open up a variety of ideas and conversations, and give children experiences to think about for weeks to come.

5. Celebrate their giving. Find ways to catch children in the act of giving. Let them know you notice and approve of their giving. Keep a light attitude and an accepting countenance. Remind them that cheerful giving is one of life's great pleasures.
World Vision 1/18/04

Working Families Tax Relief Act of 2004
On September 23, 2004, the House and Senate passed the $146 billion Working Families Tax Relief Act of 2004 and extended many popular tax breaks. By a Senate vote of 92-3 and a House vote of 339-65, both bodies in an election year strongly supported these tax extenders.
The House Ways and Means Conference Report explains many of the Family Tax Relief Act provisions.
Family Tax Relief. The family section extends the marriage penalty relief. The 15% tax bracket continues to be doubled for married couples. The 10% income tax bracket is extended and so is the $1,000 child tax credit. Family relief tax benefits equal $109 billion over 10 years.
Military Family Combat Zone Relief. Two benefits aid families with members serving in combat zones. Those in the enlisted ranks with lower income may benefit from including tax-free combat pay in the calculation for the refundable child credit or the earned income credit (EIC).
Alternative Minimum Tax Relief. There is a one-year extension of the higher $58,000 AMT exemption for married couples and the $40,250 AMT exemption for single persons. Without this extension, many middle-income families would have been pushed into the AMT brackets.
Uniform Definition of a Child. Most Americans are very surprised to discover that the IRS had many different definitions of a child. The definitions for purposes of the dependency exemption, the child credit, the EIC, the dependent care credit and head-of-household status are now the same. A child is now a child is now a child.
Finally, there are a host of other tax benefits that are extended. In the charitable giving area, the charitable deduction for gifts of computers by corporations is extended through 2005.
GiftLaw

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IRA Rollover Update
A $146 billion tax cut package (H.R. 1308) is on its way to President Bush. Despite a strong and well-organized eleventh-hour push by dedicated NCPG constituents, neither the CARE Act (S.476) nor The Public Good IRA Rollover Act (S. 283 and H.R. 4488) were approved as amendments during conference committee proceedings. Both chambers passed H.R. 1308 overwhelmingly, 92-3 in the Senate, and 339-65 in the House. In a statement sent to its members on September 24th, NCPG (the National Committee on Planned Giving) urged members to continue to contact members of Congress to encourage them to add the IRA rollover provision to other pending tax legislation.
NCPG

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Please note, individual financial circumstances will vary. The information on this site is meant as general information and does not represent legal or tax advice.. As with all tax and estate planning, please consult your attorney or estate specialist. All material is copyrighted and is for viewing purposes only. This News and Information section has been compiled by Future Focus.
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