Other Items of Interest to Planners

IRS Publishes 2007 Inflation Adjusted Figures for Taxes, Giving Limits, Mileage and Pooled Income Fund Rate for New Funds (Less Than Three Years), Rev. Proc. 2007-66,, 2007-45 IRB 970, (inflation adjustments); Rev. Proc. 2007-70, 2007-50 IRB, IR 2007-192

The IRS has published the 2008 inflation-adjusted exclusions and exemptions for gifts and estate transfers, and the miscellaneous deduction limits applicable to individual taxpayers. Selected figures of interest to planners are set out below.

Individual Income Tax
"Kiddie tax" threshold (for children under age 14) before income is taxed at parent's rate	$1,800
Standard deduction, married individual filing jointly/surviving spouse	$10,900
Standard deduction, head of household	$8,000
Standard deduction unmarried individual (not surviving spouse or head of household)	$5,450
Standard deduction, married individual filing separate return	$5,450
Personal exemption	$3,500
Gross income threshold for phase out of itemized deductions (married filing jointly and surviving spouses)	$239,950
Gift, Estate and Generation Skipping Exclusion Amounts and Rates
Annual exclusion amount under IRC § 2503	$12,000
Annual non-domestic spouse gift limit	$128,000
Lifetime gift tax exclusion amount	$1,000,000
Estate generation-skipping exclusion amount	$2,000,000
Estate tax exclusion amount	$2,000,000
Highest tax rate for gifts, estates, and generation skipping	45%
Miscellaneous Charitable Rules
Deemed rate of return for pooled income funds less than 3 years old	4.8%
Insubstantial benefit limits	$9.10, $45.50, $91
Mileage rate for deduction - charitable work	14¢
Mileage rate for business	50.5¢

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New 2008 Form 990 Available on IRS Web site, IR-2007-204 (December 20, 2007), www.irs.gov

The newly redesigned final Form 990 which charities must use for the 2008 tax year (returns filed in 2009) is now available on the IRS Web site. The new form, comprised of an 11-page basic form with 16 possible schedules, is designed to create more transparent reporting of charitable activities. The IRS announced a staggered implementation schedule allowing smaller organizations to continue to file Form 990-EZ for a period. An article summarizing the changes with emphasis on adjustments following the comment period, "Overview of Form 990 Redesign for Tax Year 2008," can be found at www.irs.gov.

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Transitional Relief for Type III Supporting Organizations That Fail New Sufficient Voice Test Reverting to Private Foundations, Notice 2008-6, 2008-3 IRB 1

Prior to August 2006, the Type III Supporting Organizations created as trusts generally met the "responsiveness test" of the regulations based on the right of the supported charities to require or compel a trust accounting. The Pension Protection Act of 2006 changed the regulations, replacing the "responsiveness" test with the "sufficient voice" test. The regulations further directed that Type III trusts not meeting the "sufficient voice" test would revert to private foundation status on August 17, 2007. Notice 2008-6 provides transitional relief by allowing Type III Supporting Organizations reverting to private foundation status on August 17, 2007 to file a Form 990 for the 2007 year and exempts the trust from excise tax for the 2007 tax year; however, these trusts must file a Form 990-PF and pay excise taxes for the 2008 tax year and forward.

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Charitable Mid-Term Federal Rates

The charitable mid-term federal rates under IRC § 7520 for gifts made in February 2008 are set out below. These rates are used to determine the present value of an annuity, an interest for a life or term of years, or a remainder or reversionary interest. Call Marilyn B. Schaffer, CAP, Director of Planned Giving, at 847. 384.3424 or e-mail marilyn.schaffer@advocatehealth.com, if you need current rates for your calculations.

February 2008	4.2%
January 2008	4.4%
December 2007	5.0%

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Chronicle of Philanthropy Reports Largest Gifts and Pledges in 2007, "Giving in 2007: A Look at the Largest Contributions," The Chronicle of Philanthropy (January 10, 2008, p. 9)

The Chronicle of Philanthropy posted its list of donors of the largest 12 donors of gifts and pledges in 2007. It is interesting to note that half of the gifts and pledges on the list were transferred to family foundations. The list reflects the increasing trend for principle and mega-gifts in the United States.

Donor	Amount	Recipient
William Barron Hilton	$1.2 billion (pledge)	Conrad N. Hilton Foundation
Jon M. Huntsman, Sr.	$700 million	Huntsman Foundation
T. Denny Sanford	$400 million (pledge)	Sanford Health Foundation
John W. Kluge	$400 million (pledge)	Columbia University
Joan and Sanford J. Weill, Jr.	$250 million (pledge)	Will Cornell Medical College
Robert Day	$200 million (pledge)	Claremont McKenna College
George Soros	$200 million	Soros Humanitarian Foundation
Eli Broad	$176 million	Broad Foundations
John P. and Tashia Morgridge	$175 million (pledge)	Fund for Wisconsin Scholars
George Soros	$160 million	Open Society Institute
T. Boone Pickens	$156 million	T. Boone Pickens Foundation
Barbara Dodd Anderson	$128.5 million (pledge)	George School

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