End of Year Tax Reminders from the VMRC Foundation
December 16, 2021
Categories: Our Community | Tips
December 16, 2021
Virginia Mennonite Retirement Community is grateful for support of our residents. As we close out this year, here are several reminders of tax benefits that are available this year, and some of the temporary provisions are set to expire December 31, 2021.
The IRS issued a special “tax tip” earlier this fall.1 Here is the gist of the benefits meant to support gift planning this year:
- It may not make sense for you to itemize deductions every year — that is the case for many givers. Right now, you can deduct up to $300 contributed to charities during 2021 — $600 if you are a married couple filing a joint return — even if you do not itemize and take the standard deduction.
- If you itemize deductions, this is for you. Usually, your eligible gifts cannot exceed a specific fraction of your income. But for gifts in 2021, you can generally elect to claim a charitable deduction for cash donations up to 100 percent of your adjusted gross income (consult your tax advisor or read the IRS update noted below for limited exceptions).
- If you run a business, there are incentives for you. The deduction thresholds for cash and food donations for many businesses have temporarily increased depending on your status as a corporation, sole proprietorship, and so forth. Explore them with your accountant or tax advisor.
These incentives are slated to end this year, so please consider taking advantage of these opportunities before December 31.
You might also reduce your tax bill by making a distribution from your IRA to VMRC. This can satisfy the required annual minimum distribution for taxpayers age 70 ½ or older, while not resulting in taxable income. It’s effectively another way to qualify for a charitable tax benefit — whether you itemize on your taxes or not!
Bottom line - consult your financial advisor or accountant about how these benefits might work for you.
To donate stocks, or make a contribution through an IRA or Donor Advised Fund, please contact Les Helmuth at email@example.com or 540-246-6020
1 See “Expanded tax benefits help individuals and businesses give to charity in 2021”, Sept. 28, 2021, https://www.irs.gov/newsroom/expanded-tax-benefits-help-individuals-and-businesses-give-to-charity-in-2021
Get Notified When We Post Content