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Tax Changes Coming Soon

Changes to tax rates and deduction limits could impact your charitable giving.

The American Quarter Horse Journal
November 19, 2012

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Changes to tax rates and deductions coming soon that may impact your charitable giving.

As you make your 2012 year-end gifts, please remember that gifts to the American Quarter Horse Foundation are tax deductible to the extent of the law. Also, some tax cuts may be expiring this December. While these tax cuts could be extended, it is still uncertain whether this will occur.

Below are a couple of major tax changes affecting charitable gift deductions in 2013 that you may wish to consider when planning your 2012 year-end gifts to your favorite charities:

  • Personal tax rates could increase. For example, a tax rate of 10 percent could potentially increase to 15 percent. And a tax rate of 35 percent could increase to 39.6 percent.
  • Next year, taxpayers may lose part of their ability to deduct charitable contributions as itemized deductions. Itemized deductions reduce taxable income by subtracting amounts greater than the standard deduction. For example, you may only be able to deduct up to 50 percent of your adjusted gross income for cash donations or 30 percent of your adjusted gross income for donations of stocks, bonds or other assets.
  • Maximum estate taxes may increase from 35 percent to 55 percent.

For more information about the Foundation, please visit www.aqha.com/foundation or call (806) 378-5029. Please visit the IRS website or consult your personal tax advisor to determine if/how the upcoming tax changes could affect your charitable giving.