Moneta Group

For several years, one of my clients and I have been discussing her charitable legacy. Most recently, we had a conversation about Charitable Gift Annuities, and it occurred to me that others may be interested in this topic.

The Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) initiated a series of tax cuts, including reductions in the income and estate tax rates. However, the act included a ‘sunset provision,’ which takes effect December 31, 2010. This means that as of that date, various tax laws revert to pre-2001 status, as if EGTRRA had never happened—unless additional legislation has been passed between 2001 and today. We are midway through 2010 and many clients want to know which provisions are expiring and which are here to stay. A few major EGTRRA provisions of importance to many of our clients are summarized here.

As the holiday season quickly approaches, we are reminded of our charitable commitments yet to be fulfilled for 2009. Given the current state of the economy, many donors, as part of financial belt-tightening, may consider deferring or canceling gifts. But there may be alternatives to cash or checks that can help maximize the value of gifts to you and your charities.

With so many items included in the various bail out and stimulus packages, it can be difficult to determine what really applies to you. Last fall we posted a blog on the potential repeal of Required Minimum Distributions (RMDs) from IRAs and retirement plans. Those over age 70 ½ should note that while RMDs were not suspended for 2008, the requirement has been lifted for 2009. This one-time option to suspend is intended to give retirees a chance for investments to recover following last year’s market sell off.