DATE: September, 2001

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.

"We are each of us angels with only one wing, and we can only fly by embracing one another."
Luciano de Crescenzo

WILL THE MILLENNIAL GENERATION MAKE A DIFFERENCE | CBO FORECASTS SMALLER SURPLUS | REAL ESTATE AS A CHARITABLE GIFT | HOUSE APPROVES VOUCHER PROGRAM FOR CHARITIES

DAILY HEADLINE NEWS FEED | ARCHIVES OF PAST MONTHS

Will the Millennial Generation make a difference?

A recent Harris pool claims that some 90 percent of college seniors at over 100 universities and colleges throughout America stated that helping others is more important than selfish gains. Also prominent in the poll is the belief (held by 97 percent of the seniors) that it is significant to them to do work that enables them to have a positive impact on the world.

The trend, perhaps a reaction to the "me generation" thinking of the 1980's and early 90's, is expected to increase as members of the Millennium Generation (generally thought of as being born after 1982) graduates and begins to enter the work force.

The nonprofit industry, which currently numbers approximately one out of every ten workers, has seen more and more colleges and universities offer courses and even degrees in philanthropy and related subjects.

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CBO Forecasts Smaller Surplus

The Congressional Budget Office August 28 officially reported a short-term horizon of on-budget deficits, setting up a budget showdown this fall and a rhetorical fight over using social security trust fund dollars to balance the government's books.

The numbers, which show the government running a $9 billion deficit in 2001 and a $2 billion surplus in 2002 when social security trust fund dollars are removed from the calculation, reveal a slightly tighter budget outlook than did the forecast released by the Office of Management and Budget August 22. The CBO did not include two of the OMB's calculations that Democrats charged were designed to ensure the administration did not break its promise of steering clear of the social security trust fund. Democrats say that changing the accounting method the fed uses to count payroll taxes that feed social security and partially reshifting a corporate tax deadline from 2002 to 2001 helped the OMB to show the on-budget surplus hovering above zero for the next few years.

According to the CBO, the government will run a total surplus of $3.4 trillion over the next 10 years, with deficits or small surpluses in the next four years and increasing non-social-security surpluses over the following six.

The CBO expects the economy will "narrowly" avoid a recession and recover next year. CBO also pushed back by four years the date by which the debt will be paid off. Because revenues will be lower and spending higher than previously projected, the Department of Treasury will not be able to pay down the debt by 2006, as was projected in May.

The CBO says the cumulative effects of the tax cut President Bush signed in June are "uncertain but will probably be small." It also reports that labor supply may rise modestly as a result of the reductions in marginal tax rates but that national savings rates may fall.
From National Committee on Planned Giving

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Real Estate as a Charitable Gift

An often-overlooked asset that provides considerable potential for charitable giving is real estate. The significant increase in property values over the last two decades has created an appealing circumstance for donors.

It isn't just the family homestead that has appreciated - property across the board to include second homes, rental properties, farms and vacant lots have all benefited. And as the holders of these properties have gotten older, more and more senior donors have found that simplifying their lives by gifting excess property is a better choice than gifting other appreciated assets such as stock.

From a practical matter alone, gifting real estate as opposed to a commercial sale generally means that the hassle, expense, tax burden and general bother are avoided. It also means the donor no longer has the maintenance and management to worry about or oversee.

While there are concerns that should be discussed regarding having the necessary liquid assets to pay the guaranteed lifetime income until such time as the real estate is liquidated, a combination of cash or highly liquid assets and real estate might prove to be an attractive idea.

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. House approves charity voucher programs

On August 2nd, the House approved legislation giving cabinet secretaries the ability to convert nearly $50 billion worth of social spending into vouchers. This would enable social programs to shop among different providers to include religious groups.

By funding social services in this manner, the government is one step removed from direct funding as the recipient of the services will have the right to choose what program he or she will attend. Under that relationship of funding, the program may institute prayer or religious education and require the participant take part.

It appears that this compromise allows those on both sides of the church-state issue to feel comfortable regarding the constitutionality of the issue. Among the programs that could be affected by the voucher option are services for the elderly, domestic violence, child abuse and after-school programs.

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The preceding is meant 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.
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