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During season for giving, gifts made before Dec. 31 could be doubly beneficial

12/07/2012

As the Monmouth College community reaches the end of another year, all members of the community are grateful for the outpouring of support from MC’s alumni, parents, faculty, staff, students and friends the college has received in 2012.
 
As MC supporters consider year-end gifts, Molly Ball, vice president for development and college relations, offers some helpful advice.
 
“No one knows if tax rates will be higher next year or not,” said Ball. “What we do know is that proposals have been put forth by both political parties that would limit the amount and/or value of federal income tax deductions for charitable gifts made in 2013. These limitations will likely impact higher-income individuals significantly.”
 
If, for example, a $10,000 gift is made before Dec. 31, 2012, it may be deducted up to the maximum federal tax rate of 35 percent, making the after-tax cost of the gift $6,500. However, if the gift is delayed until 2013, possible higher tax rates may result in an additional $3,500 in taxes on the 2012 federal income tax return.
 
Unless Congress takes action yet this year, higher tax rates are scheduled to go into effect in January. To offset paying additional tax, the best strategy for many individuals may be to accelerate income where possible and to make the most of charitable gifts in 2012.
 
“For tax savings in 2012, gifts must be received by Dec. 31, 2012,” said Ball. “The after-tax cost of a charitable gift depends on many factors, including the timing of the gift, the donor’s tax rate, the type of gift made and the tax laws. I’d recommend that alumni and friends who are thinking now about giving to the college over the coming year consult their accountant or tax adviser for additional details regarding the potential federal (and possibly state) deduction that may be claimed for gifts to Monmouth College in 2012.”
 
To make a gift of cash, individuals may mail a check or call MC’s development office at 309-457-2323 to discuss other options (credit card by phone, payment on line or setting-up an automatic payment). Checks should be made payable to Monmouth College with a note in the memo line if it is an unrestricted Annual Fund gift or restricted to a specific purpose, and mailed to Office of Development, Monmouth College, 700 E. Broadway, Monmouth, IL 61462-1998
 
For more information about making a gift to Monmouth College before Dec. 31, contact Mary Stahl, MC’s director of individual and planned giving, at 309-457-2151 (office), 309-536-1678 (cell) or mstahl@monmouthcollege.edu.