KANSAS CITY, Mo. — As 2017 comes to a close, many people find it in their hearts to make a charitable donation. This tax-deductible giving can also help people reduce their taxable income.
But as the Tax Cuts and Jobs Acts goes into effect next year, that is expected to change for many people.
Right now, the standard deduction is at $12,000, so if your property tax, state and local taxes, mortgage interest, charitable giving and other deductions goes over that amount, it makes more sense for you to file an itemized return.
In 2018 the standard deduction number doubles to $24,000, so the 30 percent of Americans who file itemized returns is expected to drop.
The Council on Foundations grant writing group expects charitable giving to decline at least $16 billion each year.
Something Joanna Sebelien, the chief resource officer for Harvesters, believes will impact them.
"By increasing standard deduction, people might not continue to itemize. They may give a gift, but it might be smaller," said Sebelien.
Harvesters runs on year-end giving, with half of its total donations coming in from October through December. Just last year it gave 52 million pounds of food away.
Sebelien said hunger is a constant issue, not just one during the holidays. However, that is when their pantry and bank account see a push.
She said some people are accelerating their donations, giving double a year early.
"If they can prepay charitable donations by the end of the year, they can still receive a tax benefit on 2017 returns," explained Lynn Ebel, a tax attorney for H&R Block.
Others are also accelerating their January mortgage payments to get credit.
"It just has to be in by Dec. 31," said Ebel.
Though it's expected millions will lose a tax incentive to give, Harvesters still hopes people will continue to donate from their hearts.
"I like to believe people give to Harvesters and other charities because they believe in what the organization is doing," said Sebelien.
