Join campaign to protect charitable giving incentive
From the National Council of Nonprofits
So far, more than 3,200 nonprofits, including 36 Hawaii organizations, have signed onto a Nonprofit Community Letter that will be delivered to Congressional Supercommittee members soon expressing the clear message: If policymakers are going to rely on nonprofits to fill the gaps created by their policy decisions, then the 12 Supercommittee members must not undermine the ability of nonprofits to serve our communities by altering the charitable giving incentive.
“The provision in the President’s original jobs bill proposal … to limit tax deductions for the wealthiest, from 35 percent to 28 percent—is now dead,” said Tim Delaney, president and CEO of the National Council of Nonprofits in an article in The Nonprofit Quarterly.
“Unfortunately, too many eyes have been distracted to that sideshow,” he said, “when in fact the actual threats to the nonprofit community lurk elsewhere—in the Joint Select Committee on Deficit Reduction. There, the consequences to those individuals and communities that nonprofits serve are far graver: disproportionate cuts to domestic programs and the possible limitation or even elimination of the entire charitable giving incentive.”
“Recent studies indicate that a cap on the deduction could result in loss of charitable giving of $2.9 billion to $5.6 billion each year,” writes Brian A. Gallagher, president and CEO of United Way Worldwide, the nation's largest privately funded nonprofit, in USA Today.
“To put this in perspective, $5.6 billion equates to eliminating all of the private donations each year to some of the top U.S. charities, such as the Red Cross, Goodwill, the YMCA, Habitat for Humanity, the Boys and Girls Clubs, Catholic Charities and the American Cancer Society combined,” he said.
In this campaign, language matters. The nonprofit community letter focuses on the “charitable giving incentive,” rather than the current-law “charitable deduction” or any one legislative proposal. Nonprofits recognize that there is room for improvement over the status quo and remain open to dialogue at the appropriate time about how best to encourage individuals to give back to their communities.
Also, the Supercommittee reportedly is considering a wide range of proposals for reducing the deficit, each of which includes some form of change to the current incentive. Perhaps the only proposal not under consideration is the one offered by President Obama, and rejected most recently by the Senate, to limit the value of itemized deductions.
