(WASHINGTON, January 2, 2013) — Independent Sector released the following statement:
Independent Sector is pleased that Congress and the Administration have taken some initial steps to address significant challenges resulting from the expiring “Bush tax cuts” and across-the-board spending cuts that would have gone into effect the first of the year.
We are also heartened that the agreement does not provide any direct limitations on the charitable deduction, and that key giving incentives, including the IRA charitable rollover, as well as enhanced deductions for the donation of food and land for conservation purposes have been reinstated and extended through the end of 2013. The compromise between parties resulted in modest improvements to the federal estate tax, though not at the 2009 levels IS has supported.
While initial proposals to impose percentage limitation or aggregate cap on itemized deductions, including the charitable deduction, were abandoned in final negotiations, the Pease provision, sometimes referred to as a haircut on itemized deductions for high income taxpayers, is included in the final deal; we would have preferred to see the charitable deduction exempted from the Pease limitation. Additionally, we recognize the agreement reached this week leaves major fiscal and tax policy issues unresolved, and that as discussions resume in Washington about increasing the federal debt limit and addressing the mandatory spending cuts known as sequestration, Congress and the President will once again be looking for additional sources of revenue.
Throughout the process Independent Sector will continue advocating to policymakers the need to preserve the incentives that encourage all Americans to give to charity, help them better understand how charitable organizations help improve lives, and urge them not to impose cuts that will adversely hurt the poorest members of our communities. We believe that deficit reduction and tax reform should balance sensible spending cuts that do not increase poverty or widen income inequality with revenue increases that maintain the progressive nature of the tax code.
Learn more about the fiscal cliff agreement on our website.
Independent Sector is a nonprofit, nonpartisan coalition of approximately 600 charities, foundations, and corporate philanthropy programs, collectively representing tens of thousands of charitable groups in every state across the nation. Its mission is to advance the common good by leading, strengthening, and mobilizing the nonprofit and philanthropic community. Learn more at IndependentSector.org.