Sep 13, 2011
President’s Jobs Plan Limits the Charitable Deduction
Yesterday, September 12th, President Obama released details on how he will finance the job creation plan he outlined to Congress last week. The $447-billion jobs bill (titled the American Jobs Act of 2011) would be paid for in part by limiting itemized deductions (including the charitable deduction) to 28 percent for families with taxable income of $250,000 ($200,000 for individuals).
The president has proposed limiting itemized deductions several times during his presidency including in his FY 2011 and FY2012 budgets and to pay for healthcare reform.
The nonprofit community has rallied in opposition. Sandra Swirski of ACR responds to the president’s plan in the Chronicle of Philanthropy noting “That’s exactly the wrong direction to go in… And at the end of the day, limiting the charitable deduction is going to hurt [those in need] the most.”
Also, the Senate Finance Committee is expected to hold a hearing in mid-October on charitable giving incentives, chief among them is the charitable deduction. We can expect plenty of activity aimed at Washington in the interim.
Additional resources and coverage:
- American Jobs Act of 2011 (full bill with analysis) (download pdf)
- Why Obama’s Jobs Bill Could Be Bad for Charity, Wall Street Journal
- Obama’s Jobs Bill Includes Plan to Limit Charitable Deductions for the Wealthy, Chronicle of Philanthropy
- White House Would Cut Deductions to Pay for Its Jobs Plan, New York Times
- Obama proposes raising taxes on the wealthy to pay for $447 billion jobs bill, Washington Post