Planned Giving Insights and Information

Is the Legacy IRA Act the Next Big Thing?

The “Legacy IRA Act” would allow a Qualified Charitable Distribution (QCD) from an IRA to fund a split interest gift (charitable gift annuity (CGA), charitable remainder unitrust (CRUT), or charitable remainder annuity trust (CRAT)). At the time of this writing, this proposed change has been included in pending legislation that is, alas, stalled as the 117th Congress heads toward adjournment in December 2022. If the Legacy IRA Act provisions are not passed this year, there are plans to reintroduce the legislation when the new Congress convenes in January 2023.  What are the chances the Legacy IRA Act will become law? And, more importantly, what should you be telling prospective donors? Before we get to those key questions, let us review the proposed Legacy IRA Act and its journey through this Congress.

New IRS 2010CM Mortality Table Throws a Curveball

We have learned something unexpected about the new 2010CM mortality table. Published in proposed regulations released by the IRS in May, 2010CM can in some situations produce a higher deduction than the 2000CM mortality table we’ve been using since 2009. This is an important realization, because the proposed regulations allow donors to compute their deductions using 2010CM or 2000CM until the IRS publishes final regulations. Naturally, donors will want to use the table that gives them the greatest benefit during this transitional period.

Research on Donor Advised Funds Presented at 2022 CGP National Conference

Dr. Danielle Vance-McMullen of DePaul University and Dr. H. Daniel Heist of Brigham Young University presented their preliminary analysis of data from 13,000 donor advised funds at the 2022 National Conference of Charitable Gift Planners last month. While some of their findings confirm what we already know about DAFs, others challenge our common assumptions. The study, which examined data from 2017 to 2020, identified four key themes.

IRS Announces Indexed Tax Items for 2023

The IRS has announced the values for 2023 of various tax items that are indexed annually for inflation. In general, values have been adjusted upward about 7.0%. Of particular interest to gift planners, the unified gift and estate tax exemption amount will be $12,920,000 ($25,840,000 per couple) in 2023, an increase from $12,060,000 ($24,120,000 per couple). So, next year a couple that takes advantage of the portability of unused estate tax exemption will be able transfer nearly $26 million to heirs without triggering any federal estate tax.