Pension reform

The second post I ever wrote for this blog, on July 9, 2002, was about foundations and pending regulatory reform. And now it is finally here. As we go forward in the short term we can stop wondering about "pending changes" and start looking for the implications of "reforms".

President Bush is expected to sign H.R. 4 into law either Thursday or Friday of this week. Its implications for philanthropy include:

- We, as an industry, may finally come to know how many Donor Advised Funds there are and what their collective asset value is, because this will need to be reported on Form 990s
- We, as individuals over the age of 70 and 1/2, will be able to donate retirement assets worth up to $100K to qualifying charities and deduct the gift from income
- Foundations that owe penalty excise taxes will owe twice as much as before
- Donors to and vendors of donor advised funds have new set of rules to play by regarding eligible and excluded grants. This is also true for Type III Supporting organizations. There are also new rules about investments, benefits, and reporting of these funds and organizations.

The bill is mostly about pension plans, and so is intended to effect our collective financial lives in terms of our retirement options, our savings, and what we can expect from employers. In other words, the actual implications for giving and philanthropy may be far more interesting than those listed above.

***My attorneys remind me to remind you, dear reader, that I am not one. Therefore, do not misconstrue the above information as legal advice.

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