How will the Fiscal Cliff affect Guiding Eyes Dogs?
by Sue Dishart
I was watching CNN last night and paused to look into the eyes of my beautiful Guiding Eyes foster dog. She looked concerned; the news was keeping her from an evening walk. I decided I needed to translate what was going on so she could understand how the new American Taxpayer Relief Act will impact the work we do at Guiding Eyes. Feel free to share the following with your beloved four-legged friends…
Let’s cover the most important item first: dog food will still be available. Guiding Eyes relies on the generosity of individuals for most of our income. And I believe most donors give because they care and they want to make a difference in the lives of the people we serve. We will just need to continue to share our stories so more friends understand the importance of all we do.
Fortunately, people can still claim a tax deduction for their charitable gifts, as round one of the fiscal cliff legislation did not directly address the tax deductibility of charitable giving. Although higher tax rates for the wealthiest Americans have been passed and itemized deductions will be limited for high-income taxpayers, charitable giving deductions are not capped…yet. Give when you can and give early this year.
Both dogs in the house lay on the floor and did a spin when I mentioned the IRA Charitable Rollover provisions. Then I shared it was a different kind of “rollover.” This is important for those over age 70 ½ who want to support Guiding Eyes by giving up to $100,000 per year (including required minimum distributions) from a traditional or Roth IRA. The rollover is available for distributions made during 2013 directly to a public charity from the IRA custodian/trustee. If you act by the January 31 deadline, there are two ways to have your gift (up to the $100,000 per year limit) still count for 2012.
First, you can treat an IRA distribution to charity made during January 2013 as having been made in 2012. Also, if you took an IRA withdrawal during December 2012, you can made a cash gift to charity and treat it as if it had been distributed directly to the charity from your IRA. Remember, although no charitable deduction is available for the rollover gift, the amount distributed to Guiding Eyes cannot be included in your income. For more information, contact your tax adviser or Guiding Eyes Director of Planned Giving (email@example.com).
Even though our dogs work, they don’t pay taxes. However, the reduced Social Security tax rate expired with the new legislation, and all dog owners will now be back to paying 6.2% instead of the payroll tax holiday rate of 4.2%. This means that most our salaries will decrease by at least $600 less each year – that’s a lot of bones.
We’ll continue to monitor Congressional activities to see how the legislation will affect the work we do at Guiding Eyes. In the meantime, we will do our part to use our resources wisely and make the biggest impact we can with the generous gifts we receive.
My final thought seemed to bring a smile to my tail-wagging friend, Janelle. Working with a Guiding Eyes dog cannot be taxed; the gifts our dogs give are absolutely priceless.
Sue Dishart is Guiding Eyes’ vice president for marketing and development. She lives in Cortland Manor, NY with her husband Steve, their Cavalier King Charles Spaniel, Teddy, and future Heeling Autism service dog, Janelle.