A. L. “Lorry” Spitzer, counsel in the MIT Office of the General Counsel, spends much of his time reviewing prospective gifts to MIT and providing support to donors. Spitzer talked with the MIT Office of Gift Planning about how the new federal tax laws might affect donors and their future planned gifts to MIT.

With the new tax law changes, what high-level considerations should be made for philanthropic gifts to the Institute? 

LS: As always, donors should first determine what they wish to support at MIT and then work with their advisors to review what assets they are able to give and what type of tax deduction they will be entitled to. They should definitely consider the benefit of contributing appreciated assets, which retains a tax advantage regardless of whether deductions are itemized. Because fewer taxpayers will be itemizing tax deductions than previously, donors may also want to look into grouping their donations in one year to achieve the greatest impact with their giving from a tax perspective. Whatever a donor decides to do, MIT will work with them. 

What are the benefits of a gift through an IRA Charitable Rollover, especially in light of the new tax laws? 

LS: With fewer taxpayers itemizing deductions under the new tax laws, the IRA charitable rollover for donors aged 70 1/2 or older becomes a much more important planning tool and a great way to make a charitable gift. Donors have the ability to avoid taxable income by having up to $100,000 of their IRA Required Minimum Distribution (RMD) sent directly to MIT as a gift, avoiding the need to report it as income and fulfilling their desire to make a charitable contribution to MIT. An IRA charitable rollover for those donors who will still itemize can also provide tax advantages by lowering their adjusted gross income and thus their overall tax liability. 

What charitable giving options are available at MIT for donors who come into a sudden tax or liquidity event? 

LS: MIT has a broad range of giving options closely tailored to the interests and needs of the donor. Of course, the best time to plan for a liquidity event is before the event occurs. The MIT Donor-Advised Fund is a great giving option in the case of such events as it allows the donor to establish the fund without having to determine the final designation of the gift. 

Is there an asset in a donor’s portfolio that would be a particularly good way to fund a gift? 

LS: Appreciated assets are often the best choice for a charitable contribution. To take just one example, the opportunity to use an appreciated asset to fund a charitable remainder trust is sometimes described as the “last legitimate tax shelter.” Donors receive the benefit of tax-free diversification and (if they choose) the ability to have the trust invested alongside the MIT endowment. Combined, these benefits can be a powerful financial tool, benefitting both the donor and MIT. Keep in mind that donors can also use these appreciated assets to make an outright gift if they would like to see their gift have an immediate impact, such as through scholarships, faculty support, or any of the priorities of the MIT Campaign for a Better World. 

What is the best way for a donor to leave a bequest to MIT? 

LS: Bequests in any form are a welcome source of support at MIT. Donors should work closely with their advisors and with the MIT Office of Gift Planning to structure a bequest that is in line with the rest of their estate plans. 

Should I consider my retirement plans as part of a charitable bequest? 

LS: Yes, we often see donors who choose to name MIT as a beneficiary of their retirement plans. This often creates a tax-efficient gift to MIT and is relatively easy to accomplish. 

What should donors expect when they make a commitment to MIT, either during their life or through their estate, in terms of the impact of their gift? 

LS: MIT greatly appreciates all gifts, large and small, current or deferred. The benefit of a current gift is two-fold. First, donors receive an immediate charitable contribution tax deduction, reducing both the current income tax burden and eventual estate tax burden. Second, there is the benefit of seeing the impact of a gift during one’s lifetime. There is a tangible immediacy to making a charitable gift that will help MIT build a better world today! That being said, a bequest made through a donor’s estate sends a powerful message about the values of the donors and their family. Whenever gifts are received, they will be promptly put to work by MIT.