A new tax law signed by President Bush on September 23 contains provisions to encourage donations to help survivors of Hurricane Katrina and to spark charitable giving in general.
Your cash contributions to Christ the King Lutheran Church (including your pledge to Bridge to the Future campaign), the Bach Society, Melanchthon Institute, Christ the King Lutheran Church Foundation, Christian Community Service Center and other institutions may be eligible under the new rules. Please consider these new rules as you plan your contributions to the church and other institutions for 2005 and beyond. These rules only apply to cash contributions made between August 28 and December 31, 2005.
The federal tax incentives include:
· Itemized deductions for cash gifts made from August 28 through December 31 by high-income donors will not be reduced. Under the usual rule, itemized deductions must be reduced by 3 percent of the amount by which the taxpayer’s adjusted gross income exceeds $145,950 ($72,975 if married and filing separately).
· Individual donors who itemize on their federal tax return can now deduct up to 100 percent of their adjusted gross income for certain cash gifts in 2005. The normal limit is 50 percent in one year. The 100 percent limit is only in effect for outright cash gifts made from August 28 through December 31. Other gifts are subject to existing limitations as before.
Please consult your tax advisor if you have questions about the new rules.
It’s important to remember that tax incentives are not reason enough to contribute to the church or charitable organizations. Our financial contributions are an important part of our personal stewardship. Giving is a tangible measure of spiritual health because giving to the church demonstrates that we are grateful to God and want to put Him first on our priority list. Christian stewards give to God proportionately, give systematically and give cheerfully.