With the adoption of the Protecting Americans from Tax Hikes Act (PATH), Congress and President Obama made permanent certain contribution rules such as the IRA charitable rollover and enhanced charitable deductions for food inventory and conservation easements. Previously, these contribution rules were renewed on an annual basis (usually in late December), making it difficult for donors to properly plan their charitable contributions for the year.
While the permanent extension of these rules is great for tax planning purposes, such permanency may garner increased scrutiny from Congress if an overwhelming amount of taxpayers choose to take advantage of these rules. If the data reflects that the permanency of these rules is adversely affecting tax revenues, such data could be cause for restructuring the rules as they are currently drafted.
Although it is too soon to tell how these now permanent rules will affect tax planning and tax revenue, taxpayers should beware that these rules may be modified in the future despite their newfound permanency.
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