The President’s FY14 Budget included the so-called Buffett Rule for the first time, although they formulated the idea and have supported it before in other measures. Steven Woolf, senior tax policy counsel, Jewish Federations of North America, breaks this complicated policy down in simpler terms in the video below.
Philanthropic organizations are obligated to provide certain types of transparency – the types that are required by the federal tax system and by state laws aimed at maintaining the donor’s intent. But current heightened calls for transparency are based on other rationales: Transparency is a good unto itself and more should be required of all institutions, it is needed to ensure that philanthropy serves “public purposes,” it will counteract the “power asymmetry” between foundations and grantees, and it is necessary for a proper evaluation of philanthropic effectiveness. Upon examination, however, John Tyler would argue that none of these rationales justifies additional legally imposed philanthropic transparency, which is what advocates demand.
Joanne Florino is the senior vice president for public policy at The Philanthropy Roundtable.
by Fred Stokeld, Tax Analysts
APRIL 11 - Representatives of the charitable community are disappointed that a proposal to reduce the value of the deduction for charitable contributions to 28 percent for higher-income taxpayers, which has appeared in every budget President Obama has proposed, resurfaced in the latest budget blueprint released April 10.
Last winter, charities were relieved that a percentage or dollar cap on the deduction, which they believe would cause charitable giving to decline, was not part of the fiscal cliff deal. (Prior coverage.) They also were pleased by reports that the Obama administration, which in prior years has proposed a cap on itemized deductions to pay for deficit reduction and healthcare reform, was willing to consider an exception for charities. (Prior coverage.)
Cap on Charitable Deduction Will Harm Charity Now More than Ever
WASHINGTON, D.C.— The Alliance for Charitable Reform (ACR) released the following statement upon release of President Obama’s FY2014 Budget:
“Each year – and sometimes more than once – the President has proposed cutting the charitable deduction, despite resounding opposition from the American public and Congress,” said Sandra Swirski, executive director of ACR. “This year, the cut is even deeper. With the January 1st tax hike, the gap between tax rates and the charitable deduction rate is wider than ever and that will translate into less giving. Not only is this harmful to giving, which will cost charities across the country billions of dollars, but it is a dangerous precedent for the federal government to set.”
April 10, 2013
Soon after the release of President Obama’s FY2014 budget, the Charitable Giving Coalition sent a respond urging the administration to reconsider its stance on the chartiable deduction. The budget incorporates a 28% cap on itemized deductions, including the charitable deduction. The letter can be viewed in its entirety here: CGC_FY_2014_Budget_letter_4-10-13.pdf
For more information, please visit protectgiving.org.
by Howard Husock, Forbes
April 10, 2013
President Obama’s long-awaited budget proposal, to be released today, does not come right out and say that intends to reduce contributions to charity—but that is almost certainly what would happen were it to become law. Here’s why. The White House has effectively doubled down on a tax change it has been pushing for four years that would limit the value of the charitable tax deduction. The Administration has, since 2009, pushed unsuccessfully to allow only 28 cents on a dollar donated to charity to be deducted—even though the top tax rate for the wealthy donors who make most use of the deduction has been 35 percent. In the budget released today, the President again proposes to cap the charitable deduction at 28 percent—despite the fact that the top rate on the highest earners has increased to 39.6 percent. Think of it this way: the White House proposal would raise the cost of giving to charity from 60 cents per dollar to 72 cents per dollar. That’s a 20 percent increase in what can be called the “charity tax.”
Dr. Steve Moore on innovative giving in the charitable community. Dr. Moore is the Executive Director of the MJ Murdock Charitable Trust Fund. As the organization’s chief executive officer, he is responsible for all programs and activities of the Trust. Steve joined the Trust in 2006.
>> Federal: Congressional Budget Resolutions: What’s in Store for Charitable Giving?
>> Federal: Next Up? The White House
>> Upcoming Events: “Transparency in Philanthropy” | April 11 at The Heritage Foundation”
>> Upcoming Events: “Charity and Government: Tax Reform and Beyond” | April 15 at the Urban Institute”
>> Upcoming Events: “The Charitable Deduction in American Political Thought” | April 16 at the Hudson Institute”
>> Consider This: Does the President have an Appetite for Less Giving?
The Hill, 4/4/13
The Charitable Giving Coalition has launched a new website aimed at protecting the charitable deduction, in the nonprofit sector’s latest effort to protect the tax break from tax reform or a grand deficit bargain.
According to a release, the site will highlight how charitable giving helps communities around the country.
“We are fully committed to helping lawmakers understand the unique nature of the charitable deduction – and that it’s not a loophole, but a lifeline,” Sandra Swirski, executive director of the Alliance for Charitable Reform, said in a statement. “It’s unique because it encourages individuals to give away a portion of their income for the benefit of others.”