CGC Thanks Ryan in Letter for Comments Supporting Charitable Deduction

Coalition Also Expresses Concern Over Floor, AGI Limitation, Evaluation

The Charitable Giving Coalition sent a letter to House Budget Committee Chairman Paul Ryan (R-WI) today thanking him for his comments supporting the value of the charitable deduction. Ryan has voiced support in recent interviews for avoiding a cap on the charitable deduction.

The coalition also reiterated concerns in the letter over proposed provisions in House Ways and Means Committee Chairman Dave Camp’s (R-MI) Tax Reform Act of 2014 that would implement a two percent floor on the charitable deduction, streamline adjusted gross income limitations, and require gifts of property to be evaluated according to basis instead of fair market value.

Click here to read the full letter.

ACR News 09.19.14—Congress Returns, Camp Plan Effect on Charitable Giving

>> Federal: Washington Roundup
>> Federal: Tax Extenders Delayed
>> Federal: Urban Institute Releases Report
>> Federal: Consider This
>> Top Reads: Study finds Camp’s tax reform would reduce charitable giving


Washington Roundup

Congress returned to Washington last week after the summer recess, but only briefly. Members will leave town late this week to return to their districts to campaign before the elections on November 4. During this short work period, leadership in both the House and Senate addressed only a few ‘must-do’ items. These included a bill to fund the government beyond the end of September to avert a government shutdown. On Wednesday, the House passed its bill to keep the government open through December 11, which also included provisions to address the recent Ebola crisis, renewed the operating authority for the Export-Import Bank through June 30, 2015, and extended the Internet Tax Freedom Act through December 11. The Senate passed the bill without amendments on Thursday, 78 to 22.


Tax Extenders Delayed

Congress officially delayed action on tax extenders, the 60-plus annually expiring tax provisions, until after the November elections. The issue received some attention this week when the House introduced a comprehensive jobs package that contained four popular corporate tax extenders that the House made permanent earlier this year. But the Senate did not take up the legislation during this work period.

As for the rest of these tax extenders, the House remains committed to its approach of addressing each provision individually and making select extenders permanent. As you may recall, in July, the House passed H.R. 4719 – the America Gives More Act – which would make permanent three charitable tax extenders: the IRA charitable rollover, the enhanced deduction for conservation easements, and the enhanced deduction for food donations. H.R. 4719 also included two other provisions that are not tax extenders but have long been ACR priorities: the streamlining of the private foundation excise tax to a flat one percent rate, and giving donors until April 15 to make charitable donations for the previous calendar year. 

Senate Finance Committee Chairman Ron Wyden (D-OR), however, said he remains committed to passing a two-year extension of expired tax incentives, much like the bill he negotiated with Ranking Member Orrin Hatch (R-UT) and passed out of committee last April. As of now, it is unclear how the House and Senate will reconcile their two approaches but some Senate aides speculate that there could be an appetite in the Senate for permanently extending a few select provisions – the ones with the most bipartisan support – and authorizing a two-year renewal for the rest.


Urban Institute Releases Report

Last week, the Urban Institute released an analysis of the impact that House Ways and Means Chairman Dave Camp’s tax reform draft would have on charitable giving. The study found that the full combination of Chairman Camp’s proposed changes could decrease charitable giving between $17 billion and $34 billion per year. More specifically, the study found that implementing just the 2% of adjusted gross income (AGI) floor, combined with a lower maximum limit for cash gifts of 40% of AGI, would decrease giving by up to $10.6 billion. These are staggering numbers and reinforce the need to continue to communicate with lawmakers about the importance and need for the charitable deduction.

As you may recall, Urban Institute Fellow Dr. Eugene Steuerle, one author of this new report, is also a member of the ACR Advisory Council. In an interview with ACR in July, Dr. Steuerle explained how the tax policy included in the draft affects the charitable sector and offered his thoughts on provisions that would help strengthen it.


Consider This

With fewer than 50 days to go, we appear to be in a near coin toss for control of the Senate.

So what is really at stake in November? Not the continued Republican control of the House because that seems like a done deal. It is all about the Senate and the set-up for the Presidential election in 2016. Although we obsess over any tidbit related to the toss-up Senate seats, we know in our heart that the stakes are not nearly as high as our level of focus.

Make no mistake about it, controlling the Senate means, to a large degree, controlling the conversation. The majority party schedules the time of the Senate floor for legislation it wants to bring up and also shapes the committee hearings, including the witnesses called to testify. However, even if the Senate does flip, the margins will almost certainly be so close that it will be near impossible to get very much done. And there is a better than even chance that if Republicans take back control of the Senate in 2014, Democrats will wrestle back the chamber in 2016 because of the number of seats that will be up for grabs. In 2014, 20 Democrats and 13 Republicans are up for election while in 2016 that flips to 10 Democrats and 24 Republicans.

What will it mean to us if Republicans take control of the Senate and Senator Hatch (R-UT) takes the gavel of the Finance Committee? While both Senator Hatch and current Chairman Wyden (D-OR) can be expected to pursue tax reform in the next Congress, both have been true friends of our sector and we don’t expect much to change. Despite the dysfunction in Washington, we will continue to press our issues in a bipartisan, bicameral way and look to them for help in that regard.


Top Reads


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ACR Blog: Constitution Day

Members of the Constitutional Convention officially adopted the Constitution as our nation’s supreme law on this day in 1787. As such, September 17 has officially been designated as a day of observance to commemorate this pivotal moment in American history.

The Constitution has endured for nearly 230 years and preserves the rights the citizens of our country hold dear. They are the very rights that have helped establish a vibrant and generous tradition of American philanthropy. In the Fall 2013 issue of Philanthropy magazine, Adam Meyerson, president of The Philanthropy Roundtable, wrote about the Constitutionally-guaranteed freedom of association and the critical role of anonymous giving in a thriving civil society. To commemorate Constitution Day, we re-publish Meyerson’s letter as a reminder of the importance of philanthropic freedom.


Continue Reading…

Philanthropic Achievement of the Week

2012- Rolling Restoration of Smithsonian’s Natural History Museum

Hall

The Smithsonian Institution was a product of philanthropy (a bequest from James Smithson), and about 30 percent of its budget continues to come from private donations (which play a particularly large role in expansions and new initiatives). A major refresh of its National Museum of Natural History began in the late 1990s, sparking the largest gift to the museum to that point from Ken Behring, who rose from harsh poverty to riches by selling cars and then developing real estate. He donated $20 million to spearhead a massive renovation of Natural History’s ground floor, resulting in, among other things, a new Hall of Mammals which opened in 2003. (Behring later donated $80 million to revitalize the National Museum of American History, making him the Smithsonian’s largest private donor.)

The Museum of Natural History continued its upgrade with a subsequent $15 million gift from major philanthropist David Koch, which created the David Koch Hall of Human Origins. Then in 2012 Koch donated an additional $35 million which will be used to remake the museum’s dinosaur hall, its most visited area. One of the highest priorities of museum officials, the dinosaur-hall funding will provide fresh displays and specimens, and allow obsolete interpretations to be updated with the newest information from the fast-changing science of dinosaur paleontology.

Smithsonian magazine, smithsonianmag.com/science-nature/New_Hall_on_the_Mall.html

Interview with Ken Behring, philanthropyroundtable.org/topic/economic_opportunity/interview_with_ken_behring

Washington Post article announcing Koch gift, washingtonpost.com/lifestyle/style/david-koch-donates-35-million-to-national-museum-of-natural-history-for-dinosaur-hall/2012/05/03/gIQAIjT3yT_story.html

Honoring the Families of the Victims of September 11

Courtesy: 9/11memorial.org
Courtesy: pentagonmemorial.org

Today we reflect upon the events that shook our nation 13 years ago and honor the fallen. With that in mind, we share an article from the New York Times about the Families of Freedom Scholarship Fund, which provides full scholarships to family members of the victims of the September 11 attacks.

“The organization initially enlisted President Bill Clinton and Senator Bob Dole to raise more than $100 million so that children with so much on their minds would not have to worry about money for college. In a fitting coincidence, the last $4.8 million of those initial contributions will be handed out this fall semester,” wrote the New York Times.

Click here to read the full article.

Philanthropic Achievement of the Week

1721 Endowed College Chairs

Hollis


Thomas Hollis, a wealthy merchant and Baptist from London, wanted to express his gratitude for the good treatment Baptists had received in Boston. So in 1721 he gave funds to Harvard University to found the Hollis Chair of Divinity with a salary of 80 pounds per year for its occupant. The gift also included money to offset administrative expenses, to increase the size of the student body, and to support “ten scholars of good character, four of whom should be Baptists, if any such were there.”

Hollis’ gift was the largest Harvard had received from a single individual. Five years later he established another professorship, the chair of mathematics and experimental philosophy. All told, Hollis’ gifts eventually topped 6,000 pounds, a staggering amount for the time.

The endowed professorship spread rapidly in the U.S. and became an increasingly popular way for donors to support institutions of higher education—undergirding the spectacular rise of American colleges and universities to their current position of international preeminence.

Nathan Wood, History of the First Baptist Church of Boston (Ayer, 1990)

ACR News 09.05.14—What to Expect When Congress Returns

>> Federal: Washington Roundup
>> Federal: Looking Ahead
>> Federal: Paul Ryan Discusses Civil Society, Charitable Deduction
>> Federal: Consider This
>> Top Reads: Tax-Smart Philanthropy Made Easy


Washington Roundup

Congress returns from a month-long recess on Monday, September 8. Members will have just two-and-a-half weeks to address several legislative issues before breaking again for the November elections.


Looking Ahead

Senate Majority Leader Harry Reid (D-NV) outlined a number of priorities for the short legislative session, including passing a bill to extend government funding to avoid another government shutdown on September 30. Leader Reid made this a priority, saying he hopes to adjourn at least by September 23 and that “there will be no weekends off.”

House Speaker John Boehner (R-OH) has also indicated he plans to pass a funding bill that will keep the government open. “I would expect there will be a continuing resolution to fund the government from September 30 into early December,” Boehner said.

Congress will likely delay any action on tax extenders—the package of annually expiring tax incentives—until the “lame-duck” time period after the midterm elections and before the end of the year. In July, the House of Representatives passed H.R. 4719—the America Gives More Act—which would make permanent three charitable tax extenders: the IRA charitable rollover, the enhanced deduction for conservation easements, and the enhanced deduction for food donations. H.R. 4719 also includes two other provisions that are not tax extenders but have long been ACR priorities: the streamlining of the private foundation excise tax to a flat one percent rate, and extending the charitable giving deadline from December 31 to April 15. 

Recall that in May, the Senate Finance Committee also passed a tax extenders package renewing through 2015 nearly all of the provisions that expired at the end of last year. This legislation also included the IRA rollover, conservation easements, and food donation incentives, but it did not make them permanent. Furthermore, the Senate legislation did not include the additional private foundation excise tax and April 15 bills. It remains unclear how the House and Senate will reconcile their different approaches into a final agreement.


Paul Ryan Discusses Civil Society, Charitable Deduction

House Budget Committee Chairman Paul Ryan (R-WI), who is widely expected to take over as Chairman of the House Ways and Means Committee, continues to be asked about charity-related issues in media appearances. In our last newsletter, we shared a story from Politico reporting that Ryan stated that the charitable deduction is “the one area where I believe we should not have a top cap.” We also have video from another interview with Chairman Ryan, this time with CNBC, in which he expressed his belief in the critical role of our civil society, approved extending the deadline to claim a charitable deduction until April 15, and reiterated his support for avoiding a cap of the charitable deduction.

The discussion was part of a broader conversation about the popular “Ice Bucket Challenge” for ALS. Chairman Ryan’s comments begin at 1:20.


Consider This

While kids across the country have already returned to school (and recess), members of Congress don’t return from recess until next week; and we expect them to leave town again as early as September 19.

What does this mean for the America Gives More Act?

It probably does not mean a lot in the short term as we don’t expect the Senate to take up the package in the next few weeks. However, Congress is already talking about a “lame-duck” session to address pieces of the America Gives More Act, namely the IRA charitable rollover, conservation easement incentive, and the food inventory donation. All three were made permanent by the House bill but not by the Senate. So, we’ve got a showdown.

And when we do get to the “lame-duck” session, the odds are that the House and Senate will split the bill with only one or two of these provisions being made permanent while the other(s) will, yet again, simply be extended for just one year. We also believe that two other provisions—simplifying the private foundation excise tax and extending the charitable giving deadline from December 31 to April 15—may come under serious consideration as well.

Bottom line: we need to push for action in the short term on these provisions with the understanding that Congress won’t likely move anything to the President’s desk until after the election.


Top Reads


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Philanthropic Achievement of the Week

1945 - Sloan-Kettering Institute

Sloan

General Motors vice president Charles Kettering is most famously known for his automotive inventions, such as the first electrical starter motor and leaded gasoline, and the 185 patents he held. Less known are his contributions to medicine and science. An extraordinarily broad tinkerer, Kettering also developed several medical innovations, such as an incubator for premature infants, treatments for venereal disease, and magnetic diagnostic devices.

In addition, Kettering was a visionary philanthropist who devoted his wealth to funding projects that could be as productive as his contraptions. In 1945, he and Alfred Sloan, another General Motors vice president, established the Sloan-Kettering Institute, the first private biomedical research center of its sort in the world. The center was built next to Memorial Hospital, an institution with its own long and impressive philanthropic history. Founded in 1884 as a specialized cancer hospital by a group that included Mr. and Mrs. John J. Astor, the hospital was moved in 1936 to its current location, on land donated by John D. Rockefeller Jr.

From its founding, the Sloan-Kettering Institute aimed to harness the latest technology and research techniques to battle cancer. Matching the spirit of its founders, it held fast to the principle that advances in research always rest on “the creative genius of individual scientists.” In 1980, the institute and the hospital were combined into a single entity and today the Memorial Sloan-Kettering Cancer Center is one of the nation’s leading biomedical research institutions and treatment facilities, treating more than 400 different subtypes of cancer with specialized regimens and advancing the state of the art via more than 120 research labs. In 2012, the first graduates matriculated from the center’s new Ph.D. program in cancer biology.

History of Sloan-Kettering Institute and Memorial Hospital, mskcc.org/about/history-overview

Charles Kettering biography, mayoclinicproceedings.org/article/S0025-6196(12)00271-6/fulltext

(VIDEO) Ryan: Civil society is one of the most important components of American life

House Budget Committee Chairman Paul Ryan (R-WI), who is widely expected to take over as Chairman of the House Ways and Means Committee, discussed several charity-related issues in this interview with CNBC last week. In this interview, Chairman Ryan expressed his belief in the critical role of our civil society, support for avoiding a cap of the charitable deduction, and extending the deadline to claim a charitable deduction until April 15.

The discussion was part of a broader conversation of the popular “Ice Bucket Challenge” for ALS. Chairman Ryan’s comments begin at 1:20.

 

Philanthropic Achievement of the Week

1954 Columbus Discovers Modern Architecture

Columbus

What brought these architectural giants to little Columbus was private philanthropy. J. Irwin Miller, chairman of the Columbus-based Cummins Engine Company, was an architecture enthusiast. In 1942, he commissioned a new design for his home church from Eliel Saarinen. The church became an instant landmark, and Miller saw a role for philanthropy in beautifying his hometown and raising its worldwide profile. He became a major patron of civic architecture in 1954, when he struck an innovative deal with the city of Columbus: when a new public building was needed, Cummins would pay the commission for any first-rate architect selected from its own list, and the city would pay for construction costs.

Miller later expanded his program to cover private buildings with public purposes, such as churches, banks, and malls. And his own house, designed by Eero Saarinen, is a National Historic Landmark. “By the 1960s,” Radley Balko has written, “Columbus had become a world-renowned magnet for privately financed modernist design.” Miller’s vision continues today: architectural grantmaking in Columbus and its surrounding area remains a central interest of the charitable arm of Cummins Inc.

Radley Balko, “When Columbus Discovered Modern Architecture,” Reason magazine, reason.com/archives/2009/09/30/when-columbus-discovered-moder
Miller House and Garden, Indianapolis Museum of Art, imamuseum.org/millerhouse/columbus-indiana