ACR Blog

#GivingTuesday

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Thousands of volunteers and organizations will participate in the third annual #GivingTuesday today in an effort to further support the nonprofit sector and charitable organizations. According to the organization’s website, #GivingTuesday is a movement to designate a national day of giving on the Tuesday following Thanksgiving, Black Friday and Cyber Monday.

There are several ways that you or your organization can get involved.  Individuals are invited to become a social media ambassador, and registered 501(c)(3) or for-profit organizations with a commitment to benefit at least one charity can become official partners. The organization has also made several tools and resources available.

One of the many great aspects of charitable giving is the fact it can be done anytime and anywhere in this country. Having an organized charitable giving effort, though, certainly can help spur even more people into action.

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Post-Election Analysis

A lot happened as a result of Tuesday’s elections and we are here to help you sort through it all. Below is a brief analysis of the election results and a glimpse at what we can expect in the makeup of congressional leadership as well as the tax writing committees.

The Balance of Congress & Leadership Changes

The headline from Tuesday is that Republicans have taken control of the Senate, picking up at least seven seats (with two more likely), giving them a majority of at least 52-45. Alaska and Virginia are still processing results, and there will be a runoff on December 6 between incumbent Louisiana Senator Mary Landrieu (D-LA) and Representative Bill Cassidy (R-LA). Neither of those candidates earned the required 50 percent plus-1 margin necessary to win the seat outright.

Current Senate Minority Leader Mitch McConnell (R-KY) will likely take over as Majority Leader next year. His deputies are also set to take over leadership positions accordingly. Current Majority Leader Harry Reid (D-NV) has said he will run for Minority Leader with the other top three Democrats in the Senate – Dick Durbin (D-IL.), Chuck Schumer (D-NY) and Patty Murray (D-WA) – having already pledged their support.

In the House, Republicans are projected to increase their margin of control by at least 13 seats, which gives the GOP its largest majority since World War II. Current Speaker John Boehner (R-OH) is expected to remain in charge with few changes, if any, to his leadership deputies. For the Democrats, Nancy Pelosi (D-CA) is expected to remain Minority Leader and her deputies are expected to maintain their posts as well.

It is worth noting the Republican wave also netted four additional governorships.

Senate Finance Committee

Senator Orrin Hatch (R-UT) is expected to become Chairman of the Senate Finance Committee. The makeup of the committee will also change to reflect the new Senate majority. The first task for Republicans will be determining how large each committee should be along with the ratio of Republican to Democrat members. These ratios are negotiated by leaders in both parties and typically reflect the Senate’s overall breakdown. Currently, there are 13 Democrats and 11 Republicans on Finance, which is approximately the same proportion as in the entire Senate.

If the Republicans add another member, names that are circulating to join the committee include Senators Dan Coats (R-IN), Dean Heller (R-NV) and Roy Blunt (R-MO).

Ways and Means Committee

While the House majority will remain Republican, the GOP increased its margin and will get to fill a few more seats on the Ways and Means Committee. 

The members of the House Republican Steering Committee are in charge of choosing new members for open committee seats. The Steering Committee will meet in the next few weeks and consult the Committee’s regional representatives to identify potential candidates for open slots on all House committees.

With Chairman Dave Camp (R-MI) retiring and the election now over, Budget Committee Chairman Paul Ryan (R-WI) has formally announced his intention to seek the Ways and Means gavel. It is still possible he could face a challenge from Rep. Kevin Brady (R-TX), but Ryan is widely considered the favorite. While every other Ways and Means Member won re-election, Representatives Jim Gerlach (R-PA) and Rep. Tim Griffin (R-AR) are retiring at the end of the year. For the Democrats, Representative Allyson Schwartz (D-PA) unsuccessfully ran for governor and had to give up her seat. 

Names that are circulating to join the committee include Reps. Kristi L. Noem (R-SD) and Patrick Meehan (R-PA) as almost shoo-ins, and a third to be selected from Reps. George Holding (R-NC), Bill Huizenga (R-MI), Reid J. Ribble (R-WI), Tom Rice (R-SC), Todd Rokita (R-IN) and Jason T. Smith (R-MO).

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Nonprofit Issues

ACR Expertise Highlighted in Coverage of Elections

A couple of articles published and circulated Wednesday by the Chronicle of Philanthropy featured comments from staff and a member of the Alliance for Charitable Reform regarding the results of Tuesday’s elections. The Chronicle interviewed several nonprofit leaders, including ACR Executive Director Sandra Swirski, for an article analyzing the prospects of tax reform with Republicans taking control of the Senate and expanding its membership in the House of Representatives. Swirski spoke about the April 15 provision in the America Gives More Act, which would give taxpayers until April 15 to make charitable contributions applicable to the previous year. The House includes many previous small business owners who instinctively understand that business owners are in a better position to give to charity after they close their books at year end and are into the first quarter of the following year.

“They know that it’s not until the dust has settled that they really have an idea of their profits,” Swirski said to the Chronicle.

The Chronicle also included in its daily newsletter an opinion piece written by Alicia Philipp and ACR Strategy Committee member John Tyler that was originally published in February but has renewed significance following the elections. The editorial, Lawmakers Must Understand Philanthropy to Make Better Policy Choices, explains how grant makers need to speak directly to policy makers to help them understand the work of foundations as policies that will affect the sector are considered.

The best way for policy makers to learn about philanthropy is for more foundations to communicate directly with them. At a time when government money is tight and lawmakers are looking for more resources, foundations can no longer modestly rely so much on letting our activities speak for themselves or letting our grantees and trade groups do our talking for us.

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Nonprofit Issues

(VIDEO) The Effects of a 100 Percent Charitable Deduction


In the August 22  edition of the ACR newsletter, we shared a story about Puerto Rico adopting a 100 percent charitable deduction in 2011. The deduction led to a 70 percent increase in the number of individuals who made charitable donations in Puerto Rico, according to a report released by the Flamboyan Foundation.

The Flamboyan Foundation is a private, family foundation focused on improving educational outcomes for children in public schools in Washington, D.C. and Puerto Rico, according to its website. The Alliance for Charitable Reform recently interviewed Kristin Ehrgood, president of the Flamboyan Foundation, about the implementation of the tax deduction, the results of the Flamboyan Foundation’s study, and how studying donor behavior could help expand charitable giving in Puerto Rico.

 

 

 

 

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Nonprofit Issues

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.

Misconceptions about “Dark Money”
By Adam Meyerson

A long legal tradition protects the rights of Americans to make charitable contributions without publicly disclosing them. This right to confidentiality in charitable giving is grounded in our constitutional freedom of association, and it is one of the most important elements of philanthropic freedom.

The Supreme Court ruled unanimously in NAACP v. Alabama in 1958 that “freedom to engage in association for the advancement of beliefs and ideas is an inseparable aspect of the ‘liberty’ assured by the Due Process Clause of the Fourteenth Amendment.” In a landmark judgment written by Justice John Marshall Harlan II, the court held that the state of Alabama could not compel the NAACP to reveal the names and addresses of its members because doing so would expose its supporters “to economic reprisal, loss of employment, threat of physical coercion, and other manifestations of public hostility” and thereby restrain “their right to freedom of association.” This right of confidentiality applies to members of all associations, whether they be religious, educational, cultural, ideological, or devoted to other causes. As professor Anita Allen of the University of Pennsylvania Law School has put it, “Thanks to NAACP v. Alabama, government may not force even a controversial group to identify its members, absent a compelling state interest in disclosure.”

Our tax code similarly protects the confidentiality of individual contributions to public charities. In their 990 tax returns, public charities have to disclose their largest contributors, but this is for purposes of tax administration only. The Internal Revenue Service is strictly forbidden by statute from revealing these names to the public or even, with a very limited number of exceptions, to other government agencies. The same prohibitions apply when individual taxpayers have to provide the IRS with documentation about their charitable contributions. Indeed, one of the most disturbing allegations in the current IRS scandal is the charge that the agency in recent years has violated its rules and long tradition protecting donor privacy.
Donors do have to disclose publicly their contributions to private grant-making foundations, which in turn have to disclose their grants to public charities. These transparency requirements help to protect against self-dealing and to make sure that foundation grants support genuinely charitable organizations.

Donor-advised funds, America’s most rapidly growing charitable vehicle, receive donations from individuals and then make grants to other public charities on the recommendations of the original donors. Like foundations, the sponsors of donor-advised funds (which include regional community foundations; Christian and Jewish funds; and for-profits such as Fidelity and Schwab) are required to disclose the grants they make to other charities; this helps ensure that the grants are going to charities and not to for-profit or partisan political operations. But consistent with America’s historic confidentiality protection for individual donors to public charities, the sponsors can keep private their own donors as well as those donors’ individual grant recommendations.
This protection is sometimes misunderstood. For instance, conservative critics of the Tides Foundation, a liberal-left donor-advised-fund sponsor, have called it a system “to evade transparency.” Liberal critics of DonorsTrust, a donor-advised-fund sponsor for “organizations that promote liberty,” have labeled it as a “secretive funding network” and “dark-money ATM.” But the right to privacy enjoyed by contributors to donor-advised funds is no different than the right to privacy that governs the overwhelming majority of charitable giving.
Most donors of course are happy to see their contributions publicized. But a sizable minority want their philanthropy to be anonymous and will not give unless they can keep their donations confidential.

There are multiple reasons to give privately. The great 12th-century Jewish theologian Maimonides held that the second highest form of giving was “to give to the poor without knowing to whom one gives, and without the recipient knowing from whom he received.” In the Gospel of Matthew, Jesus taught that “when you give to the needy, sound no trumpet before you…do not let your left hand know what your right hand is doing, so that your giving may be in secret.”

Many anonymous donors want to protect themselves from unwanted solicitations, to protect their children from knowledge of their family’s wealth, or to be able to visit prospective grantees and “kick the tires” without anyone knowing they are a funder. Still others, like the 1950s NAACP donors, want the freedom to support controversial organizations without fear of reprisal or ostracism.

So-called “dark money” illuminates our free society.

Adam Meyerson is president of The Philanthropy Roundtable.

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Rep. Ryan: No Top Cap for 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, recently expressed his support for not implementing a cap on the charitable deduction, according to a report from Politico. Ryan stated that the charitable deduction is “the one area where I believe we should not have a top cap.”

As you may recall, Chairman Ryan was one of the members of Congress that ACR leaders met with on July 8 to discuss charity-related issues. He noted in the meeting his strong belief in charitable services and the importance of private giving. The group did not discuss any specifics in terms of how he would treat the charitable deduction, or any other tax incentives, in any future tax reform plan.

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Ryan’s recent comment came during an interview with Bloomberg TV in reference to his support for cutting the current mortgage interest deduction.

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Nonprofit Issues

Salt Lake Tribune Op-ed: Don’t let tax reform undermine charitable giving

Fraser Nelson, executive director of the Community Foundation of Utah, and Jeramy Lund, a Utah private investor, co-wrote an editorial in the Salt Lake Tribune  on August 16 urging Utahns to contact their elected officials this month while members of Congress are home. Lund and Nelson explain the importance of constituents letting elected officials know how the decisions they make will affect the nonprofit sector.

“As the public sector continues cost-cutting measures, it’s important our leaders in Washington understand philanthropy’s importance here in Utah and are mindful of how their decisions affect Utahns’ charitable nature. House Ways and Means Committee Chairman Dave Camp’s laudable effort to achieve comprehensive tax reform illustrates how the decisions taken by Congress could have immediate benefits — or cascading consequences — for our community,” wrote Lund and Nelson.

Lund and Nelson further discuss how specific proposals like the IRA charitable rollover and pay out requirements for donor advised funds will affect private charitable giving – for better and for worse. While the editorial focuses primarily on Utah, the sentiment can be applied across the country for those who serve in the charitable community.

The full editorial can be read here.

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Private Charitable Giving: A New Italian Tradition

By Priya Narapareddy

Colosseum

Private charitable giving has played a significant role in the United States in preserving our country’s historical culture and landmarks. For example, David M. Rubenstein is one of many well-known philanthropists who share a passion for preserving American history. According to a recent Washington Post article, Rubenstein, who agreed to cover $7.5 million of the cost of restoration for the Washington Monument after the 2011 earthquake, has also made a donation of $12.35 million to restore Gen. Robert E. Lee’s home at Arlington National Cemetery. 

Few countries in the world can rival Italy when it comes to the number of landmarks and their historical significance. And now Italian officials are beginning to understand that private charitable giving can play a critical role in the preservation of their nation’s historical sites, many of which date back thousands of years.

“Our doors are wide open for all the philanthropists and donors who want to tie their name to an Italian monument,” Italy’s culture minister, Dario Franceschini, said in an interview with the New York Times in July.

The Times piece explains that while the U.S. has historically used public-private partnerships to preserve our landmarks, the Italian government has historically held the primary responsibility for maintaining its country’s historical sites. Italian officials are now asking that the private sector help and they have backed up this request with charitable giving incentives. The Italian government now allows individual donors to receive a credit equal to 65 percent of the gift over three years.

Some of Italy’s most famous citizens and corporations have stepped up to the plate to contribute. Diego Della Valle, the founder of Tod’s, has contributed $34 million, part of which will go to a multi-year restoration project of The Colosseum in Rome. The Salvatore Ferragamo Group has given an $817,000 donation to restore part of the Uffizi Gallery in Florence.

Private charitable giving has proven essential in preserving our nation’s most treasured historical sites. Whether it assumes the same role in Italy has yet to be seen. Regardless, the recent encouragement of private charitable giving by the Italian government is testimony to its critical role in creating and sustaining a vibrant civil society.

 

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Nonprofit Issues

Paul Ryan on tax policy and private charitable giving

Joanne Florino, senior vice president for public policy at the Philanthropy Roundtable, asks House Budget Committee Chairman Paul Ryan about private philanthropy during a recent event hosted by the American Enterprise Institute.

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Serving Our Veterans

On the eve of the celebration of Independence Day, we wanted to share an interview we conducted with Thomas Meyer who is the program manager of veterans services at The Philanthropy Roundtable. Meyer is also the author of Serving Those Who Served: A Wise Giver’s Guide to Assisting Veterans and Military Families. In this interview, Meyer explains how veterans are a source of great human capital for our country and discusses the approach philanthropy should take in supporting our nation’s veterans.

In addition to the interview, below is an excerpt from Meyer’s guidebook:

There is much alarmism about veterans today. “Judging from media accounts, I’m the rare American veteran who isn’t homeless, homicidal, or suicidal. . . .” started a recent essay in the Atlantic by former soldier James Joyner. Much of this gloomy commentary is inaccurate or misleading.

For instance, a definitive government study released in 2013 found that while suicides among veterans rose 10 percent from 1999 to 2010, the suicide rate among the overall population rose much faster during that same period—up 31 percent. And two-thirds of veteran suicides are among those 50 years and older, suggesting the biggest problem is not among men and women deployed since 9/11.

As a group, it is much more accurate to think of veterans as a national asset than as a national problem, or set of victims. Nearly 6 million Americans have served in the military since the 9/11 attacks: 2.8 million of them are still serving; 3.2 million are civilians as of early 2013. Some of those civilian veterans are in college, at home raising children, or retired; of those who are in the labor force, more than 90 percent are employed.

The annual earnings of all U.S. veterans are 12–15 percent higher than the earnings of non-veterans. Their poverty rate is only a little more than half the overall rate.

None of this is surprising when you notice that veterans rank higher than the general population in levels of intelligence, physical fitness, avoiding a criminal record, finishing high school, and attending college. To help you separate realities from the many myths about veterans in circulation today, we have included at the end of this book a set of vital statistics. You’ll find clear data on the topics above, as well as others like physical health, mental health, family status, and so forth.

While those who have served in the military are—on the whole—in better shape than comparable non-veterans, there are many individuals who need and deserve help. Foremost among these are the men and women who were injured during their service. In this book, we lay out six areas where there are opportunities for public-spirited donors to aid veterans. In all of these areas, donors and charitable groups are already making progress, though both the successes and the remaining gaps vary a lot by region.

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