This week Congress passed the Hiring Incentives to Restore Employment (HIRE) Act (HR 2847) and the legislation was signed by the President today. The HIRE Act is one of the latest jobs bills Congress has been considering.
Of most importance to the nonprofit community, the HIRE act provides an incentive to hire new employees by exempting employers from paying the Social Security payroll tax on the wages of any new employee through December 31, 2010. In order to qualify for the exemption, the new employee must have been previously unemployed for at least 60 days, not be replacing another employee, and they must be hired between February 3, 2010 and January 1, 2011. Because even nonprofit employers pay payroll taxes for their employees, nonprofits are able to benefit from this legislation. Attached is the final language as enrolled, and an article from BNA that talks about the importance of employers taking advantage of this benefit as soon as possible.
2010 Summit for Leaders in Washington D.C.
ACR thanks all of the foundation and non-profit organizations for joining us yesterday at the 2010 Summit for Leaders.
Sessions included a survey of the national political landscape from top congressional staffers, a spirited discussion on big ideas in protecting philanthropic freedom, and tactics to engaging your legislators from a former member of Congress.
The day concluded with a toast to Senator John Thune for his work in protecting the charitable deduction.
Full summaries of the event are coming soon!
***Final agenda added below***
...to thank the sector’s charitable deduction champion
ACR cordially invites foundations and charities to join us as we honor
Senator John Thune
… for his leadership on policy issues important to the non-profit sector.
Please join us for a reception with colleagues and friends in the sector
to thank Senator Thune for his leadership.
March 16, 2010
5:30 - 6:30 pm
The Monocle Restaurant
Capitol Hill, Senate side
107 D Street NE
Transportation will be provided to/from the L’Enfant Plaza Hotel
This reception is being hosted in conjunction with ACR’s 2010 Summit for Leaders.
RSVP by March 10 to Amy (email@example.com).
For an interesting look at Senator Thune read this profile in the New York Times.
Washington Post op-ed by Michael Gerson
Michael Gerson criticizes President Obama for his use of the itemized deduction cap to finance government spending at the expense of the non-profit community, the roots of his career.
Gerson notes: “During the last budget cycle, some defenders of this proposal argued that a tax on giving would help the nonprofit sector by funding greater health coverage, which would relieve pressure on nonprofit social service providers. With health reform now on life support, this bank-shot justification is even more absurd. The Obama administration is left with one argument: that the federal government would use the money gained from this tax better than would the private sector. The president is welcome to make this case, but he can no longer simultaneously claim to be a champion of the nonprofit world. This proposal indicates not only an ideological enthusiasm for expanded government but also a disdain for civil society.”
The Charitable Deduction Coalition sends a letter to the White House
On Friday, February 5, 2010, the Charitable Deduction Coalition sent a letter to President Obama asking that the White House reconsider limiting the charitable deduction in the FY 2011 budget proposal.
“As we stated during the healthcare debate, this proposal would create a disincentive for taxpayers who give the most to charitable organizations to continue their generosity. Our nation cannot afford to discourage giving at a time when charitable organizations are facing enormous financial challenges stemming from the economic downturn.”
The entire letter is available below.
Tuesday, March 16, 2010
8:00 am – 12:30 pm
REGISTER by phone: 202-822-8333
Charitable tax deduction is back on the chopping block
The President released his FY 2011 Budget this morning. As part of this new budget, as we expected, President Obama again proposed to limit the itemized deduction, including the charitable deduction. The proposal would limit those who earn over $200,000 (singles) and $250,000 (couples) annually to a 28% itemized deduction cap (versus the 33% and 35% rates currently applied to these taxpayers). Unlike last year, however, the funds raised from this proposal would go toward reducing the deficit; last year, the revenue raised from the limitation was set aside for health care reform efforts.
ACR will be carefully monitoring these issues in the coming weeks. While the President’s Budget proposal does not carry the force of law, it does provide a blueprint for Congress to consider when they put together their own budget in the next few months.
Thune defends the charitable deduction at a critical time
Senator John Thune released a press response to the president’s 2011 budget.
According to the press release, this budget proposal reduces the federal tax deduction for charitable deductions (like President Obama’s budget proposal last year). Notably, Senator Thune was successful in getting his amendment to the FY 2010 budget to preserve the full deduction approved in the Senate by a vote of 94-3 last April. It was eventually stripped from the final budget bill
Thune notes, “At a time when many in our country and around the world are struggling, any action that could limit charitable giving should not be undertaken,” added Thune. “I will continue working with my colleagues to preserve the full deduction for charitable giving.”
ACR will continue to work with Senator Thune who has been a champion for the philanthropic sector in protecting the charitable deduction.
For more on Thune’s work, click the “Thune” tag below.
ACR recaps highlights from the President’s State of the Union Address
Following is a broad summary of the proposals offered by the President (select ‘Continue reading’).
The important take-away from his speech is that the Administration has made a hard pivot away from health care reform, which wasn’t mentioned until half an hour into the speech, toward
in a clear effort to win back some of the political favor lost over the last few months. This new focus, combined with his plan to freeze government spending, will no doubt send Congress searching for additional revenue raisers – potentially including higher marginal tax rates for those singles earning more than $200,000 and couples earning more than $250,000.
ACR will be carefully monitoring both the President’s FY 2011 Budget and Congress’ work on the budget for any potential issues relating to the nonprofit sector. As always, we will continue to keep you updated on the latest.