Larry Katzenstein offers charitable organizations guidance on tax fallout of ‘fiscal cliff’ law

Private Client partner Larry Katzenstein parsed the potential tax impact of the two-week-old American Taxpayer Relief Act of 2012 during a Jan. 16 webinar attended by hundreds of the nation’s largest nonprofits, charities and foundations.

The session provided an overview of changes to charitable giving practices since the passage of the 154-page law, signed by President Obama on Jan. 2 to avert the so-called “fiscal cliff.”

Of particular note for charities is the law’s creation of a short window — now in effect — that allows donors to make an IRA charitable rollover and have it count toward the 2012 tax year. This window closes on Jan. 31, so Katzenstein urged charities and foundations to keep their books open and contact donors to notify them of the valuable giving opportunity.

“The American Taxpayer Relief Act of 2012: What It Means For Your Nonprofit” was organized by The Stelter Company, a leading Des Moines-based provider of planned giving marketing materials to charities. Katzenstein serves on the company’s advisory board, and helped it develop the Gift Illustrator, an online service used on charity web pages that allows donors to explore personal giving options.

The webinar, led by Lynn Gaumer, Stelter’s senior technical consultant, also covered the extension of the Bush-era tax rates, the revival of the Pease limitation on itemized deductions, and the increase in the capital gains rate. While the law does makes some changes, it’s likely that most charitable donors will not change their charitable contribution patterns, Katzenstein told attendees.