More On Tax Planningfrom The Advisor's Professional Library
- Health Insurance: Health and Medical Savings Accounts A Health Savings Account is a trust created exclusively for the purpose of paying qualified medical expenses of an account beneficiary. Although they are popular, they are not without their pitfalls and the regulations can be complicated. Learn more about how to avoid federal taxation on the accumulation and distributions of HSA.
- Annuities: Estate Tax The value of certain types of annuities may be included in an estate’s value. Understanding the intricacies of these inclusions is a critically important aspect of estate planning.
Americans donated an estimated $316 billion to charitable causes in 2012, according to the annual Giving USA report, released Tuesday.
Gifts from American households and bequests from their estates, corporations and foundations grew 3.5% year-over-year (1.5% adjusted for inflation) in 2012.
The report, issued by the Giving USA Foundation and its research partner, the Indiana University Lilly Family School of Philanthropy, included these findings:
—Giving by individuals rose to $229 billion in 2012, an estimated 3.9% increase (1.9% adjusted for inflation)
—Giving by bequest decreased an estimated 7% in 2012 (8.9% adjusted for inflation) to $23 billion
—Giving by corporations and their foundations rose 12.2% in 2012 (9.9% adjusted for inflation), to an estimated $18 billion in the form of cash, in-kind donations and grants
—Giving by foundations increased 4.4% (2.3% adjusted for inflation) to an estimated $46 billion in 2012, according to Foundation Center figures.
Contributions to arts, culture and humanities organizations rose an estimated 7.8% last year—a sharp contrast to a decline of 17.6% in 2008 and slow growth through 2011.
Charities focused on the environment and animals also saw significant growth in 2012 over 2011, up 6.8%. International giving, which had enjoyed very high growth rates in some recent years, leveled off in 2012 to a 2.5% increase.
The modest increase in charitable giving last year matched the same figurative portrait of 2012’s economic indicators, the report said. Some trends were positive, others were negative, but overall, growth took place.
“When you consider all the factors that go into determining how much we give to charity, modest growth makes sense and is actually encouraging,” Gregg Carlson, chair of the Giving USA Foundation, said in a statement.
“Most households feel pressured at every economic corner, but the longstanding social contract between Americans and the nonprofits they believe in remains resilient and intact; many see giving as a core budget item.”
Publicly aired federal proposals aimed at capping or eliminating the charitable tax deduction may have influenced some giving decisions, David King, chair of the Giving Institute, said in the statement.
“Philanthropic giving fares best in a known environment, and has been dependent, in part, on certain factors holding true over the decades, including the charitable tax deduction,” King said.
“Some donors may have ‘prepaid’ gifts they had intended to make in 2013 to ensure they received a tax benefit, while others may have chosen not to donate out of concern that deductions for very large gifts would not carry over in 2013 and beyond.”
Check out Senate Finance Mulls Charitable Giving Reform on AdvisorOne.