State Legislation
The Chronicle of Philanthropy reports that New York Governor David A. Paterson has signed into law a revenue bill passed by the state’s legislature that limits charitable deductions for wealthy residents. New Yorkers with state-adjusted gross incomes above $10-million annually—about 3,500 taxpayers— are now able to write off only 25 percent of their charitable contributions on their state income taxes rather than the previous 50 percent.
“The last thing on earth charities need is a disincentive from the government to people who are their donors, especially their biggest donors,” says Abigail Disney, New York philanthropist and grandniece of Walt Disney.
She makes a stark prediction: “New York is a leader in philanthropy, so what New York does I can’t imagine other states won’t follow,” she said, adding: “Congress could go looking at it, too.”
Read full coverage here.
Last night, the New York Senate joined the Assembly in passing a budget plan that included a provision limiting the deduction for those who earn more than $10 million annually to only 25 percent of their charitable contributions, rather than the current 50 percent. This affects approximately 3,500 New York taxpayers and would be in effect for three years, including the current 2010 tax year. Governor David Paterson is expected to sign the budget into law.
ACR and The Philanthropy Roundtable joined efforts with other national nonprofit organizations to express opposition to this measure. ACR is also concerned that this may signal a trend we’ll see in other states and in Washington.
For full coverage, visit the Chronicle of Philanthropy.
Click here for additional background on this issue.
The Washington Legal Foundation just published its Summer 2010 edition of Conversations With…
This edition is dedicated to threats to philanthropic freedom and features Former Attorney General of the United States and Pennsylvania Governor Dick Thornburgh leading a discussion with Dr. Larry P. Arnn, President of Hillsdale College; Heather R. Higgins, President and Director of The Randolph Foundation; and Adam Meyerson, President of The Philanthropy Roundtable. The three reflect on the American tradition of philanthropy and the growing movement to impose further government regulation on the philanthropic world.
Further Reading
Efforts to cap the charitable deduction in New York are pending.
Update:
August 10, 2010 - New York Governor David A. Paterson has signed into law a revenue bill passed by the state’s legislature that limits charitable deductions for wealthy residents.
Read full coverage here.
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Further Reading
Consider this…
Unlike the federal government, every state except Vermont has some form of balanced budget requirement. What does this mean in practical terms for the future of philanthropy?
We all know that the economy has not been kind to state and federal budgets. At the federal level, the government has responded by pumping money into the economy, in the hopes of jumpstarting economic growth and in the process running up enormous deficits. But balanced budget requirements at the state level won’t allow that and as a result, states are in the hunt for revenue with a vengeance.
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Governor Linda Lingle vetoed H.B. 1907 a tax bill that would have capped itemized deductions for higher income individuals including charitable contributions. The measure would have resulted in tax increases totaling more than $140 million over the next five years.
The non-profit community expressed concerns to Governor Lingle that this measure would discourage donations and contributions from individuals and small businesses since they would no longer be able to deduct these contributions on their State income tax returns.
Lingle noted in a Statement of Objection (see below), “Our community is still feeling the impacts of the recession and this is the time when we want to encourage donations to charitable organizations, not enact laws that hinder them.”
Download:
- Press Release: Governor Lingle Vetoes Bills that Discourage Investments, Charitable Contributions
- Governor’s Statement of Objection
Chronicle of Philanthropy Letter to Editor
On Sunday, July 11, 2010, the Chronicle of Philanthropy published a Letter to the Editor from Sue Santa, Senior Vice President for Public Policy at The Philanthropy Roundtable, in response to an opinion piece by Emmett Carson, President of the Silicon Valley Foundation. Carson was critical of the Florida legislation (SB 998) advanced by ACR and the Roundtable to protect philanthropic freedom.
Here’s an excerpt from Santa’s piece:
“We at The Philanthropy Roundtable agree with Emmett Carson that “government should not be in the business of deciding who sits on foundation boards or which nonprofit organizations receive grants based on demographics.” And this is precisely the intent of the new Florida law on philanthropic freedom—no more, no less.”
View both articles here:
- Letter to the Editor: Florida’s New Foundation Law Protects Donor Intent
- Opinion: Opinion: New Fla. Law Makes It Harder for Foundations to Live Up To Values
Adam Meyerson comments on the passge of recent ACR bill
In today’s Washington Examiner and San Franciso Exmainer, Adam Meyerson, president of the Philantrhopy Roundtable, provides commentary on the recent bill passed in Florida to protect philanthropic giving.
Here’s an excerpt:
“Americans are increasingly worried about government overreach into areas of the economy and society that would have seemed unimaginable just a few years ago. So it is refreshing to see that private-sector leaders in at least one important area—charitable giving—are starting to push back.
Earlier this month, the state of Florida passed a law that actually limits the ability of the state to interfere with its citizens’ private charitable giving. The new law guarantees charitable donors the freedom to give to the charities they care about and in the manner that they think will be most effective.
Overall private giving is likely to increase, to the benefit of all. It’s an encouraging example that other states may soon be following.”
Click here to read the full op-eds:
- Washington Examiner
- San Franciso Exminer
New bill protects philanthropic freedom and encourages charitable giving in the sunshine state
On May 27, 2010, Governor Charlie Crist of Florida signed into law Senate Bill 998 which protects Florida foundations and the charities they support. ACR, along with a coalition of key legislators, foundations, philanthropic associations and policy organizations, advanced this legislation as part of a state-based strategy to protect donor intent and philanthropic freedom.
Additional Resources
- Legislation: SB 998 text (see page 10, line 288)
- Summary of Legislation:
- Press Release: ACR announces bill passage (June 1, 2010)
- Policy Brief: Philanthropy’s Future in the Sunshine State, James Madison Institute (December 2009)
- Point of View: Assault on Philanthropy, James Madison Institute (December 2009)
- Model Legislation: Text of Model State legislation to protect philanthropic freedom
Press
- Summer 2010 President’s Note: Sunshine for Philanthropic Freedom, Philanthropy Magazine (Adam Meyerson)
- 7/11 Letter to the Editor: Florida’s New Foundation Law Protects Donor Intent, Chronicle of Philanthropy (Sue Santa)
——6/11 Opinion: New FL Law Makes It Harder for Foundations to Live Up to Values, Chronicle of Philanthropy (Emmett Carson)
- 6/14 Opinion: FL Law Stands up for Charity, Washington Examiner & San Francisco Examiner (Adam Meyerson)
- 6/4 Florida Protects Philanthropic Freedom, Philanthropy Daily
- 6/1 Fla. Adopts Legislation to Protect Foundations’ Autonomy, Chronicle of Philanthropy
- June New Florida law, Resolutions Promote & Protect State’s Philanthropy, Florida Philanthropic Network
Welcome to the inaugural issue of the Alliance for Charitable Reform’s biweekly newsletter. We’ll provide you with news and views on issues that impact philanthropy.
In this issue:
Washington Roundup
In the States
Consider This…
Making Headlines
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