New Analysis Confirms House Tax Reform Bill Will Decrease Giving

(WASHINGTON, November 8, 2017) – The following statement is from Daniel J. Cardinali, president and CEO of Independent Sector:

“Yesterday, the Joint Committee on Taxation (JCT) released an analysis confirming that the House of Representatives’ Tax Cuts and Jobs Act would result in a significant decline in charitable deductions claimed by taxpayers in 2018. Under the House bill, 31 million taxpayers lose access to the charitable deduction, cutting off almost 95 percent of taxpayers from a longstanding incentive that has, for 100 years, increased charitable investment in the economy and ensured the well-being of our communities.

The $95 billion in ‘savings’ from a 40 percent reduction in the number of taxpayers claiming the charitable deduction is used to pay for cuts in other parts of tax reform. But this is a “pay-for” that creates more problems than it solves. Charities and the communities we serve are more than a bargaining chip or line item in this debate. It is imperative that people committed to nonprofits and their missions make their voices heard.

This bill has the opposite effect of our universal deduction proposal, which research shows would increase charitable giving by allowing all taxpayers to claim the charitable deduction, instead of just the nation’s wealthiest five percent.

The JCT also confirmed that the damage to the charitable deduction is exacerbated by the bill’s proposal to weaken the Johnson Amendment. Currently, the Johnson Amendment protects charities and their missions from partisan politics. The JCT found that the bill will allow $2.1 billion in contributions to be funneled through the charitable deduction for political purposes as opposed to charitable missions. This raises serious concerns about the future of the charitable deduction, donor privacy, and the public’s trust in the nonprofit sector.

Independent Sector and millions of concerned organizations across the country urge Members of the House and the Senate to ensure any tax reform bill strengthens the charitable sector’s ability to serve communities and offers solutions to all families.”

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Independent Sector is the only national membership organization that brings together a diverse set of nonprofits, foundations, and corporations to advance the common good. Learn more at independentsector.org.

Contact:
Kristina Gawrgy Campbell
202-467-6144
kristinac@independentsector.org

Types: Press Release
Global Topics: Congress, Public Policy
Policy Issues: Charitable Deduction, Charitable Giving, Donor-advised Funds, Estate Tax and Other Tax Incentives, Lobbying & Political Activity, Nonprofit Operations, Political Activity Rules, Private Foundation Excise Tax, Tax & Fiscal Policy, Tax Reform, UBIT, Volunteer Mileage Reimbursement