Every Geoscientist Needs A Plan
December 6, 2020
In 2020 we have learned that change can happen quickly, but in the face of exceptional challenges, our basic humanity and goodness prevail. What the year has revealed is both striking and reaffirming because, through it all, we have witnessed amazing generosity and compassion from the Jackson School of Geosciences friends and alumni.
To urge Americans to look for ways to help others in response to the covid-19 crisis, Congress encouraged charitable giving in 2020 through specific provisions in the CARES Act. By taking advantage of these unique opportunities, only available this year, you can make a huge impact on the Jackson School and benefit financially.
The CARES Act: Save Big And Give More In 2020
- The CARES Act allows all taxpayers to take a charitable deduction of up to $300, even if you do not itemize. In plain English, if you donate up to $300 in cash to a qualified organization like The University of Texas at Austin, your adjusted gross income (AGI) will be reduced by up to $300 — and you can still claim the standard deduction.
- For those who do itemize their deductions, the new law allows for cash contributions to qualified charities, such as the University of Texas at Austin, to be deducted up to 100% of AGI, up from 60% previously. This might be a good year to group multi-year gifts or make large cash gifts to maximize both your deduction and impact on the causes that matter to you.
- The CARES Act waives the Required Minimum Distribution (RMD) rules for Individual Retirement Accounts (IRAs), but for 2020 only. Nonetheless, IRA owners over age 701⁄2 can still give up to $100,000 directly from their IRA to UT and UT and pay no tax on the distribution.
- Visit https://utexas.planmygift.org/cares-act for additional strategies on smart ways to give in 2020.
Planning to Change the World
We are hearing from many alumni and friends that their financial advisors are encouraging them to review and update their estate plans before the end of 2020 in anticipation of potential changes on the horizon.
Given the economic strain of COVID-19, there could be changes in the way estates and lifetime gifts to family members are taxed, if not in 2021, then certainly by 2026. Under current law, an individual’s assets will not be subject to estate tax at death unless the value of those assets exceed $11.58M for 2020. (The same is generally true for a married couple with a combined estate of about $23M.) Also, under current law, that threshold amount sunsets down to $5M (or $10M per couple) in 2026. The value of any assets over those amounts will be subject to the 40% estate tax rate at death.
There are proposals to reduce the $11.58 million lifetime exclusion — possibly to as little as $3.5 million per person. There are many estate planning tools and gifting strategies one can implement before the end of this year to plan for potential changes in the law. In addition to minimizing or eliminating potential estate taxes for beneficiaries, many of these tools and strategies can also benefit a person immediately and/or provide for family members.
UT has a team of Gift and Estate Planning professionals with 100+ years combined experience available to consult with you and your advisors in confidence and without obligation. If you’d like to schedule a meeting or have any questions, please feel free to call me at 512-808-6018 or Katie Fendrich who works with supporters of the Jackson School in the Gift and Estate Planning office of at 800-687-4602, email firstname.lastname@example.org. Let me know if I can arrange a confidential Zoom meeting or call in the next few weeks.
Executive Director Development & Alumni Relations
Associate Director Geology Foundation
Jackson School of Geosciences
The University of Texas at Austin