1. Planned Giving Council of Houston December 01, 2016
Post-Election Update
Planned Giving Council
of Houston
December 01, 2016

2. 115th Congress - House
Republicans retain control but with tighter margins
Fractured Republican caucus
Trump-Ryan relationship

3. 115th Congress - Senate 51-48 (*52-48) Republican majority
Reconciliation process
2018 election map will impact policy

4. Lame Duck Minimal legislative activity in remaining days
Current CR runs out December 9th
Leadership wants quick, clean bill
Tax bill unlikely

5. Trump Administration Which Trump will show up to govern?
With whom will he surround himself?
Will he claim a mandate and where will he use his political capital?
Where does he stand on tax reform and charitable giving issues?

6. First 100 Days (…And Beyond)
Infrastructure legislation (paid for with tax reform?)
Immigration legislation
Obamacare repeal
Rollback of regulations, executive orders
Budget due in February but often pushed back
Debt-limit deadline (mid-March) (look for spending cuts and reforms)
Supreme Court and other key nominations ASAP

7. Tax Issues in 2017
Tax reform (very) likely in 2017, Republicans are first looking for bipartisan opportunities while keeping reconciliation on the table
House Republicans released a blueprint for comprehensive tax reform in June which could serve as framework for 2017 reform
Cost of the plan is $191 billion over the next decade using “dynamic” scoring; $2.4 trillion using traditional “static” scoring

8. Tax Issues in 2017, con’t
Plan represents a substantial break from earlier Camp proposal
Headline: House plan retains the charitable deduction but contemplates changes, all while expanding the standard deduction (dramatically reducing the number of itemizers); plan lowers rates (theoretically meaning more money in donors’ pockets)

9. Tax Issues in 2017, con’t
Condenses current seven individual brackets into three: 33 percent, 25 percent and 12 percent
Expands the standard deduction, reducing number of people who itemize from roughly 1/3 to around five percent
Eliminates all deductions except the charitable and mortgage interest deductions but notes that “charitable giving is fueled by economic growth”
“Experts and advocates for charitable organizations have presented many policies over the years for reforming the deduction for charitable contributions to make it more effective and efficient. The Committee on Ways and Means will develop options to ensure the tax code continues to encourage donations, while simplifying compliance and record-keeping and making the tax benefit effective and efficient.”

10. Tax Issues in 2017, con’t Eliminates the estate tax
Reduces corporate rate to 20 percent
Creates new business tax rate of 25 percent for pass-through entities (e.g., partnerships and LLCs)
Reduces tax on capital gains, dividends, and interest by allowing individuals to deduct 50 percent of investment income, meaning rates of 6 percent, 12.5 percent, and 16.5 percent on investment income depending on individual’s tax bracket

11. Tax Issues in 2017, con’t
Trump’s campaign plan was modified late in the campaign to more closely align with House Republican plan
Condenses current seven individual brackets into three: 33 percent, 25 percent and 12 percent
Increases the standard deduction from $6,300 to $15,000 for singles and from $12,600 to $30,000 for married couples filing jointly
Caps all itemized deductions — including the charitable deduction — to $100,000 for individuals and $200,000 for couples

12. Tax Issues in 2017, con’t
Eliminates federal estate and gift taxes but disallows step-up in basis for estates over $10 million
Reduces the maximum corporate tax rate to 15 percent, all business income passed through from S corporations and partnerships, or earned by freelances, would be taxed at 15 percent

13. Tax Issues in 2017, con’t
Tax bill will be critical vehicle for charitable sector issues
No consensus on charitable deduction
Under Trump plan, charitable giving would fall (in the short-term)
Potential fallout from focus on Clinton and Trump foundations during campaign
Miscellaneous legislation
Declining federal support for nonprofits

14. Issues of Focus Charitable Deduction
Increased threshold for itemized deductions
Cap on itemized deductions
Charitable giving will decrease in the short term
Protect IRA Rollover

15. Making the Case
Charitable giving is critical to offset reductions in spending by Congress
Speaker Ryan and Chairman Brady relationship
Must be proactive to retain charitable giving measures and not reactive to written legislation
Non-profit sector must work together to increase impact

16. Stay Informed of Latest Developments
Role of CGP in Advocacy
Stay Informed of Latest Developments
Inform National Membership
Support a Unified Voice for Charitable Giving
Partner with Leading National Organizations
Leverage State and National Membership in Advocacy Efforts

17. Interpret changes for donors and organizations
2017
Interpret changes for donors and organizations
Educate ourselves on changes to vehicles and tools
Stay focused on donors and build relationship