2024 tax season – Reminders, advice, and planning considerations

The IRS opened tax season on January 29, 2024. Advisors and CPAs gather 1099s, W-2s and K-1 forms while their customers eagerly await the news of any tax refund. In the flurry of tax season activity, advisors and their charitably inclined clientele should take note of these Federal tax reminders.

Important Dates:

The most important day is April 15, 2024. On this day, individuals should file Form 1040, trustees should file Form 1041, and split-interest trustees (charitable lead and remainder trusts) should file Form 5227. An individual or trustee can request a six-month extension to file to October 15, 2024 (Form 1041 is extended five and-a-half months to September 30, 2024). If an individual or trustee plans to file close to April 15, he should file an extension to ensure against late filing. The IRS will charge a 5% per month penalty on any tax due from a late filing of Form 1040 or 1041 or $20 per day penalty on a late Form 5227 (penalty increases to $120 per month for trusts with gross income exceeding $302,000).

Any tax due on Form 1040 or 1041 must be paid by April 15, 2024, even if the taxpayer files an extension. The IRS will charge a penalty of .5% per month for tax paid after April 15.

April 15, 2024 also marks the last date for contributing to an IRA for 2023, to take the first year Required Minimum Distribution from qualified retirement plans, and to pay the First Quarter of estimated taxes for 2024.

Tax filing advice:

Taxpayers should file a return electronically when available. Most federal tax forms, including Form 1041 and Form 5227, can be filed electronically. After reviewing the tax return his CPA or administrator prepares, a taxpayer will sign an authorization for an Electronic Return Originator (ERO), typically the CPA who prepares, to send the return electronically to the IRS. When the IRS accepts the return, the ERO will get a confirmation.

If a taxpayer chooses to file a return paper or has no choice, the returns and checks should be sent through priority or certified mail. The taxpayer should print and retain confirmation from the postal services online tracking to prove the postmark and receipt of the package.

Advice for donors taking a charitable deduction:

Donors should request and receive written acknowledgment of a gift to any qualified organization of $250 or more. The donor keeps the written acknowledgement as proof of the deduction if the IRS questions it.

Gifts of noncash assets valued at $5,000 or more, except publicly traded securities, must receive a qualified appraisal. The period for a qualified appraisal starts 60 days prior to the gift and ends on the due date of the taxpayer’s return claiming the deduction.

For example, a donor gifts a parcel of appreciated land to her donor-advised fund on December 1, 2023. She files a six-month extension on her 2023 Form 1040. The donor’s qualified appraisal must be dated on or between October 2, 2023 and October 15, 2024. The cost of an appraisal is a miscellaneous itemized deduction. The Tax Cuts and Jobs Act of 2017 disallowed miscellaneous itemized deductions through December 31, 2025.

Form 8283 must be attached to a return when the deduction for noncash contributions equals or exceeds $5,000. In some cases, the form requires the signature of a representative of the recipient charity and/or the signature of a qualified appraiser. Taxpayers and advisors unsure if signatures and appraisals can be obtained by April 15, 2024 should file for an extension. Documentation relating to the charitable deduction should be retained at least three years after filing.

2024-25 tax planning:

As of this writing, a bipartisan bill works its way through Congress. If it passes, the bill expands the child tax credit and restores some business tax breaks. A proposal to double the state and local tax deduction (SALT) is also in discussion. These will have little direct effect on charitable giving but will affect small business owners and benefit many individual filers.

December 31, 2025 is a significant day for all taxpayers and advisors. On this day, the Tax Cuts and Jobs Act of 2017 sunsets. After five years enjoying the tax breaks provided by the Act, taxpayers and advisors should note the potential for significant tax changes when planning long-term. A brief list of items to consider for income, estate, and gift tax planning include:

  • Marginal tax rates increase to pre-2018 levels. The top tax rate on ordinary income will increase from 37% to 39.6%.
  • The estate tax exclusion will be drastically reduced. The 2024 exclusion amount is $13.61 million ($27.22 million combined for a married couple). The 2017 exclusion amount, which was prior to the passage of the Act, was $5.49 million ($10.98 million combined for a married couple).
  • The current expanded standard deduction will revert to the lower standard deduction plus dependency exemptions in place prior to the Act. Many more individual taxpayers will itemize deductions in 2026 and beyond.
  • Unlimited state and local tax deductions and miscellaneous itemized deductions return. The 60% AGI limit on cash gifts goes away and becomes 50% of AGI again.

Regardless of who gains control of the government after the November election, expect contentious negotiations in 2025 on extending TCJA provisions, particularly the estate tax exemption.


Taxpayers should plan ahead. An extension and extension payment should be sent by April 15, 2024, if any doubt exists in receiving tax forms or necessary documentation for charitable deductions. With tax laws set to undergo some change in two years, taxpayers should consult with their advisors under both favorable and unfavorable tax laws. Talk with an advisor at Ren to aid advisors with estate and income tax planning by providing charitable solutions like donor-advised funds,charitable remainder trusts, and charitable lead trusts.

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