TAX BULLETIN 2018-1: TAX REFORM SIGNED INTO LAW allowed funds to be used for home schooling was dropped at the last minute and is not in the final legislation. e Charitable gifts. A charitable contribution deduction is limited to a certain percentage of the individual’s adjusted gross income (AGI), and this limitation varies depending on the type of property contributed and the type of exempt organization receiving the property. Under 2017 law, cash contributed to public charities, private operating foundations, and certain non-operating private foundations generally could be deducted up to 50% of the donor’s AGI. Under the Act, this 50% limitation is increased to 60%. The provision retains the 5-year carryover period to the extent that the contribution amount exceeds 60% of the donor’s AGI. e Investment expenses and investment interest. Under 2017 law, investment expenses were deductible as a “miscellaneous itemized deduction” if, and to the extent, they exceed 2% of AGI. The Act repeals the deduction for “miscellaneous itemized deductions” that are subject to the 2% AGI limitation, such as investment management expenses. Under 2017 law and current law, investment interest is not a “miscellaneous itemized deduction.” Therefore, the deduction for investment interest remains untouched and continues to be deductible to the extent of investment income. CONCLUSION Given the significant tax changes in 2018, planning will be a challenge. It is important to understand the implications that the Act can have on your particular tax situation. National Wealth Planning Strategies 1Tax Bulletin 2017-5 summarized the key tax provisions in HR1, known as the Tax Cuts and Jobs Act (the “House Bill”), which was passed (227-205) by the House on November 16, 2017. Tax Bulletin 2017-6 summarized the key tax provisions in the initial Senate bill HR1, also known as the Tax Cuts and Jobs Act, which was subsequently amended and passed (51-49) by the full Senate on December 2, 2017