IMPORTANT TAX ADVISORY

NEW TAX LAW AFFECTS YOUR CHARITABLE GIVING OPTIONS WITH

THE AQUIDNECK LAND TRUST

On September 23, 2005, President Bush signed into law an expansive relief package for victims of Hurricane Katrina. Thanks to this special legislation, taxpayers will find it easier to support hurricane relief while also remembering their favorite charities.

This package is designed to promote outright cash gifts. Presently, cash charitable deductions are limited to 50% of adjusted gross income. In the case of cash gifts made to charities between August 28 and December 31, 2005, the deductions are not limited, allowing, effectively a 100% deduction. This provision effectively permits unlimited IRA withdrawals and outright gifts to charity. Taxpayers over the age of 59½ have the opportunity to withdraw assets from their IRA’s or qualified plans and contribute them to charity. Such withdrawals will be added to adjusted gross income, but the contributed amount will be deductible from income, resulting in a “wash.”

There is no dollar limit; a person can withdraw and give $100 or $1,000,000. Please note that the IRA owner must withdraw the desired amount this year and make the gift by December 31, 2005 to qualify for this tax incentive. IRA custodians may take two to three weeks to process withdrawal requests. Accordingly, IRA owners should make the request by early December to allow time for processing by the IRA custodian.

Personal circumstances will impact this special giving opportunity, as state and federal tax laws may affect you. Before taking such actions, you should consider how an increase in your adjusted gross income may reduce the amount you can deduct for medical expenses and casualty losses, accelerate the phase-out of personal exemptions, cause some loss of other itemized deductions, or cause an increase in your state taxes.

As always, we are advising our donors to consult with their tax advisors about the optimum amount to contribute in 2005 and the advisability of making contributions from your IRA’s or other qualified plans.

Should you be interested in making a charitable contribution in support of the Aquidneck Land Trust recognizing new favorable, yet time sensitive tax benefits, or if you have any questions about these rules and how a gift would impact the Land Trust, please contact David F. Guertin, Jr. at (401) 849-3798 or dguertin@ailt.org.

The Aquidneck Land Trust’s mission is to preserve Aquidneck Island’s open spaces and natural character for the lasting benefit of our community. With the closing on Escobar’s Highland Farm, the Land Trust has conserved over 1,288 acres on Aquidneck Island. The Land Trust is a 501(c)(3) non-profit organization. For more information visit www.AquidneckLandTrust.org or call (401) 849-2799.

The email providing a link to this message has been sent to the entire Aquidneck Land Trust email list. Please let us know if you do not wish to receive these email updates by replying to this message. If you have any questions or comments, please call 401/849-2799 x18 or email cwatson@ailt.org

As always, thank you for your continued support
of conservation on our Island.