Charitable Deduction
Highlights from the latest edition of the ACR newsletter:
ACR Blog Roundup
- What Does Transparency Mean to Philanthropy and Why Should You Care?
- House Committee Holds Hearing on Tax Issues Important to Philanthropy
- Online Training Resource on Lobbying and Advocacy Worth Your Time
- Massachusetts Legislature Considers Capping Nonprofit Executive Compensation
Washington Roundup
- Hearing on Expired Tax Benefits
Consider This…
Tax Reform Buzzwords
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Consider This…
The House and Senate are on a break this week so we thought this might be a good time to take a breath and run through some of the buzzwords and catch phrases on tax reform that might affect the charitable sector. Only a few policy makers will say “we should limit charitable giving incentives.” But that does not mean the outcome of what many policy makers are proposing will do just that.
General phrases like this that should catch your attention include:...
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Consider This
Last month, as part of the Summit for Leaders we organized a stellar team of more than 40 foundation and nonprofit leaders for our ACR Fly in/Speak Out. They fanned out across Capitol Hill to meet with 40 Congressional offices that are deeply involved in tax and philanthropic issues.
Now for the good news/bad news. By our reckoning, a good time was had by all and our message about preserving the charitable deduction, both now and when we get to tax reform, was warmly received. The bad news is that for those most in the know on Capitol Hill there were no assurances that charitable giving will be protected in the context of tax reform. Indeed, we heard on multiple occasions that when it comes to tax reform, “everything is on the table.”
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We’re delivering the ACR newsletter one day early before the holiday weekend. Here are highlights:
- New Feature - ACR Blog Roundup
- Washington Roundup:
- Before Leaving for Recess
- Tax Work
- Consider This: Congressional Outlook Post Easter Recess
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Consider This
Mercifully for those of us who live and work in Washington, D.C., both the House and Senate have decamped for a two-week break back in their home states.
So what do we expect when they return? Something on the order of “let the political games begin!” Absent a major ‘kumbaya’ moment –which gets further out of reach as each day passes and we get closer to election day on November 6th– Washington is going to resemble the “Hunger Games” without the bows and arrows.
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Today’s special edition newsletter provides a recap of the 2012 ACR Summit for Leaders. ACR took to its new blog to write about each of the panels at the Summit. You can get a full wrap up of those panels by visiting the blog (http://www.acreform.com/blog) but we’ll provide a snapshot below.
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NEWS
ACR, Coalition send letter to the President
3.13.12 - Today, ACR and The Philanthropy Roundtable joined a coalition of other national nonprofit groups in asking the President not to cap the charitable deduction, reminding him of the impact it could have on those who need charity the most. Read the letter to the President.
President’s budget proposals will likely dampen giving
2.13.12 - The President’s FY 2013 budget includes proposals that would likely result in a drop in private giving. Once again there is a proposed limit on itemized deductions which would reduce the value of the charitable deduction to 28% for families with incomes over $250,000 and there are recommendations for tax reform, including the “Buffett Rule”, which would significantly change the tax structure for higher income earners. Learn more and read our response to the budget.
President’s State of the Union Address
1.27.12 - Bloomberg BNA reports that The Obama Administration may be stepping back from its former proposal to cap charitable deductions at 28 percent despite a proposed increase to their incomes taxes.
RESOURCES
Following are resources that provide background on efforts at the federal level to impact the charitable giving.
News
Recent news stories we have highlighted and find of interest.
- 3/16/12 Taking Away Charity Tax Deduction Would Hurt Nonprofits, Ithaca Journal (Joanne Florino, Triad Foundation)
- 3/15/12 In a Time of Enmity, the Charitable Deduction May Be Too Good to Give Up, AARP Blog (David Whitehead, AARP Blog)
- 3/6/12 Less Charity and More Taxes, Please, Philanthropy Daily (Scott Walter)
- 3/4/12 Make No Mistake: Nonprofits Need the Charitable Deduction, Chronicle of Philanthropy (Joanne Florino, Triad Foundation Inc.
- 3/26/12 Tax Reform Is Really Hard, Slate
- 3/4/12 Budget Deficit Forces Questions About Charity Spending on Lobbying, Chronicle of Philanthropy
- 2/20/12 Nonprofits Oppose Obama’s Charitable Deduction Changes, Sojourner
- 2/18/12 White House says Charitable Giving Won’t be Hurt by Tax Plan, Chronicle of Philanthropy
- 2/16/12 White House Explains Reasoning Behind Charitable Deduction Cap, Nonprofit Quarterly
- 2/16/12 The President’s Budget and Charitable Contributions: Driving Revenue and Demonstrating Fairness to Benefit America, White House Blog
- 2/14/12 Charitable Deduction Proposal in President Obama’s FY 2013 Budget, BNA
- 2/13/12 Charities Oppose Obama Plan on Limiting Charity Write-Offs, Chronicle of Philanthropy
- 2/13/12 Obama Budget Plan Includes New Call to Limit Charitable Deduction, Chronicle of Philanthropy
- 2/3/12 ‘Buffett Rule’ Tax Bill Would Preserve Charitable Deduction, Chronicle of Philanthropy
- 2/3/12 Only Charitable Deduction Preserved in New Buffett Rule Tax Proposal, BNA
- 1/25/12 President Vows Not to Deter Wealthy From Giving, Chronicle of Philanthropy
- 1/24/12 Obama Lays Out Policy Proposals, Wall Street Journal
- 1/9/12 Nonprofit Views Offered by the Republican Presidential Contenders, Chronicle of Philanthropy
Click here for articles before 2012.
Research
Studies, reports and polling information on the impact of changes to the charitable deduction from a variety of sources.
- Academic
Government
Think Tanks
Polls
Administration Proposals: President Obama has proposed limiting the charitable deduction for high-income earners in several proposals over the past few years.
Deficit Reduction: As part of federal deficit reduction talks, following are proposals that have been raised, which include changes to the charitable deduction:
- “Gang of Six” – A Bipartisan Plan to Reduce our Nation’s Deficits Report recommends that Congress “reform, not eliminate” tax expenditures for health, charitable giving, homeownership, and retirement. (July 2011)
- Solutions Initiative - The Peterson Foundation released six deficit reduction plans from the American Enterprise Institute, the Bipartisan Policy Center, the Roosevelt Institute Campus Network, the Center for American Progress, the Economic Policy Institute, and the Heritage Foundation. The six plans addressed all aspects of Federal spending and revenue-raising, including reforming the current tax code.
- Bipartisan Policy Center: Debt Reduction Task Force – Restoring America’s Future Report recommends a tax credit equal to 15 percent of any donation received, similar to the Gift Aid system in Great Britain. (February 2011)
- The President’s National Commission on Fiscal Responsibility and Reform (“Deficit Commission”) - The Moment of Truth Report proposes recommendations to reduce the deficit that call for massive discretionary spending cuts and eliminating tax incentives, including the charitable deduction. (December 2010)
- Century Foundation, Demos, and the Economic Policy Institute – Investing in America’s Economy: A Budget Blueprint for Economic Recovery and Fiscal Responsibility Report proposes converting the deduction to a refundable credit. (November 2010)
Opinion & Thought
Opinion and thought pieces by experts, scholars, and leaders in the nonprofit sector on the charitable deduction.
- 3/16/12 Taking Away Charity Tax Deduction Would Hurt Nonprofits, Ithaca Journal (Joanne Florino, Triad Foundation)
- 3/15/12 In a Time of Enmity, the Charitable Deduction May Be Too Good to Give Up, AARP Blog (David Whitehead, AARP Blog)
- 3/11/12 U.S. Should Not Reduce the Rich’s Tax Incentive to Give to Charity, New Jersey Star-Ledger (Andy Germak, Institute for Families)
- 3/6/12 Less Charity and More Taxes, Please, Philanthropy Daily (Scott Walter)
- 3/4/12 Make No Mistake: Nonprofits Need the Charitable Deduction, Chronicle of Philanthropy (Joanne Florino, Triad Foundation Inc.
- 3/1/12 Obama Makes Fifth Attempt to Reduce Charitable Tax Deduction, The Foundary (Ryan Messmore, Heritage Foundation)
- 2/13/12 Protecting Americas Charities, Huffington Post (William Daroff, Jewish Federations of North America)
- 2/14/12 President Obama’s Proposed Charitable Deduction Cap Rides Again, Nonprofit Quarterly (Rick Cohen)
- 2/14/12 Obama’s Continued War on Philanthropy, Commentary Magazine (Jonathan S. Tobin)
- 2/12/12 Jesus Didn’t Want Higher Taxes, Philadelphia Enquirer (Rick Dunham, Dunham+Co.)
- 2/7/12 In Taxes Obama Must Be Clear on Charity, The Hill (Former Congressman Robin Hayes (R-NC))
- 1/28/12 Value of the Federal Charitable Deduction, West Virginia Gazette (Paul Daugherty, West Virginia Grantmakers)
Click here for op-eds before 2012.
Other Resources
Links to help you stay informed on proposals and legislation or to contact your representative.
- Information for Policymakers and Staff
- Hearings: Following are scheduled or recent congressional hearings on issues impacting charitable giving.
- Quotes - Read what nonprofit leaders, elected officials, and other voices have to say about the charitable deduction.
- Chronicle of Philanthropy - Research, reporting, and views on the charitable deduction.
- State Profiles - State profiles on the economic value and impact of the nonprofit sector compiled by Independet Sector.
- THOMAS (Library of Congress) - Source for federal legislative information including searching for bills, Members of Congress, and legislative committees.
Stay Involved
ACR is engaged in protecting the charitable deduction through a number of ways.
Events:
Following are letters from coalitions of charitable and philanthropic organizations, including the Nonprofit Coalition, to Members of Congress and the Administration:
- 12/15/11 Letter to Chairman Max Baucus (deficit reduction), Nonprofit Coalition
- 11/7/11 Letter to the Super Committee (Committee recommendations), Nonprofit Coalition
- 9/21/11 Letter to the Super Committee (Jobs bill), Nonprofit Coalition
- 9/21/11 Letter to Congress (Jobs bill), United Way
- 7/18/11 Letter to the President & Congressional Leaders (Debit Ceiling/Deficit Reduction Negotiations), Independent Sector (appeared as full-page ad in Politico)
- 7/14/11 Letter to Senator Max Baucus & Congressional Leaders (Debit Ceiling/Deficit Reduction Negotiations), Nonprofit Coalition
- 7/14/11 Letter to members of Congress (Debit Ceiling/Deficit Reduction Negotiations), Grantmakers Forum of New York
- 3/4/11 Letter to the President (FY 2012 Budget), Nonprofit Coalition
- 2/5/10 Letter to the President (FY 2011 Budget), Nonprofit Coalition
- 10/1/09 Letter to Senator Max Baucus (Healthcare Reform), Nonprofit Coalition
- 9/21/09 Letter to Senator Max Baucus (Healthcare Reform), Nonprofit Coalition
Interested in getting involved with efforts to protect the charitable deduction?
Contact William Coughlin (.(JavaScript must be enabled to view this email address)) for more information.
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Consider This.
Shortly after former Governor Mitt Romney released his tax returns, a newbie political reporter called us and asked if we thought it was a problem that Romney had given so much to charity and received a charitable deduction. Our response? Not a chance. The problem, at least from the view of political optics, would have been if he had given too little.
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The latest edition of the ACR newsletter is available below. Here are highlights:
New Publication
Washington Roundup:
- Tax Bills
- Election Shakeups
Consider This: Presidential Candidates and Their Charitable Giving
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The Philanthropy Roundtable released the second edition of its popular publication How Public is Private Philanthropy? Separating Reality from Myth by legal scholars Evelyn Brody of Chicago-Kent College of Law and John Tyler of the Ewing Marian Kauffman Foundation.
Part of the mission of The Philanthropy Roundtable is to make its members aware of the features of the legal and policy climate that may affect donors’ ability to achieve their charitable aims most effectively. In recent years, this climate has included increasing pressures from some public officials and advocacy groups to subject private philanthropies to more uniform standards and stricter government regulation. Such changes could significantly affect the ability of philanthropies to continue to play their role in supporting and nourishing American pluralism…
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