Whether you already support the San Antonio Area Foundation, have your own fund or are thinking about getting involved, it’s important to know that we’re keeping a close eye on tax law changes that could affect your charitable giving plans.
You may have heard about the “Big Beautiful Bill” (H.R. 1), which passed the House of Representatives by a narrow vote last month. The bill now goes to the Senate, where it will likely change before anything is final. For now, nothing is set in stone. We won’t know exactly how it affects charitable giving until the process is complete.
Our team is here to help you think through your giving plans — whether the bill passes as written or not.
Planning for the Future
Many people choose to include charitable gifts in their estate plans. This allows them to leave a lasting impact on causes they care about and improve life in our community for future generations. If you’re updating your estate plan, we’re happy to work with you and your advisors to help structure a meaningful gift.
A Note About Estate Taxes
The federal estate tax affects only a small number of people, but when it does apply, it can be significant. The current top rate is 40 percent. If your total assets — including real estate, investments, retirement accounts, business interests, life insurance and personal property — are worth more than $13.99 million (or $27.98 million for married couples), estate taxes could apply to you.
Right now, a higher estate tax exemption from the 2017 Tax Cuts and Jobs Act is set to expire at the end of this year. However, the proposed bill would make that higher exemption permanent. Still, if you expect your estate might be taxable, including a charitable gift to a fund at the Area Foundation can help reduce that tax burden.
Changes for Private Foundations
The bill proposes a big increase in excise taxes on the investment income of large private foundations — jumping from 1.39 percent to as much as 10 percent for the biggest ones. Smaller foundations with under $50 million in assets would not be affected.
If you’re considering a private foundation, remember the Area Foundation offers other options — like supporting organizations and donor-advised funds (DAFs) — that unlock better tax advantages while remaining simpler, less costly and just as impactful for supporting your favorite causes.
It’s Not Just About Taxes
Most people give because they care, not just for tax reasons. Whether or not taxes are a factor for you, the Area Foundation is here to help you make a lasting difference in our community.
Other Proposed Changes to Know
The bill would keep the higher standard deduction from the 2017 tax law and temporarily raise it even more through 2028. This means fewer people would itemize their deductions, so fewer would claim a charitable deduction (but remember, most people give for reasons beyond taxes).
The bill also adds a small charitable deduction for people who don’t itemize: $150 for individuals and $300 for couples.
What’s Next?
The Senate is reviewing the bill this month, and it could take until July or August before the House and Senate agree on a final version to send to the president.
If you have any questions or want to talk about how to structure your charitable giving — no matter what happens with tax laws — please reach out. Our team is here to help you support the causes you care about in the most effective way possible.
