New Voice Media | Word and Way
     
 
Wednesday, October 01, 2014
Home arrow News arrow Archives arrow 2012 arrow Fiscal cliff talks worry charities
 
Fiscal cliff talks worry charities Print E-mail
Wednesday, December 05, 2012

WASHINGTON  (ABP)—Representatives of the Charitable Giving Coalition, comprised of about 600 nonprofit organizations, descended on Capitol Hill for two days of lobbying Congress. They want to make sure any federal budget deal does not eliminate or change the deductibility of charitable gifts.

The White House wants to end Bush-era tax cuts for the wealthiest Americans. Republicans in Congress propose raising revenues by cutting loopholes and entitlements. Both sides have mentioned a possible middle-ground solution of capping the amount of income that people who itemize their taxes can claim as a deduction for charitable giving.

President Obama has advocated capping the charitable deduction at 28 percent for couples making more than $250,000, people who now may claim deductions as high as 35 percent.

During the campaign, Republican presidential candidate Mitt Romney offered an alternative approach that would limit all personal deductions to $25,000, including those taken for charity, an idea that has resurfaced as lawmakers return to work on an agreement before the country heads over the so-called “fiscal cliff” Jan. 1.

Nonprofit leaders wrote the president and congressional leaders in November to warn that tampering with the charitable deduction would reduce people’s incentive to give at a time when government cutbacks will force more and more Americans to turn to charities for help.

On Dec. 4-5, hundreds of members of the Charitable Giving Coalition were expected in Washington to bring “a dose of reality” to lawmakers during “D.C. Hill Days” defending the charitable deduction.

“The charitable deduction is different than other itemized deductions in that it encourages individuals to give away a portion of their income to those in need,” coalition leaders wrote in November. “It rewards a selfless act, and it encourages taxpayers to give more to charities than they would otherwise have given.”

Richard Land, president of the Ethics and Religious Liberty Commission of the Southern Baptist Convention, issued an action alert Nov. 28 urging constituents to call their Congressman and senators and urge them to oppose any measure that would place additional restrictions on charitable deductions.

“The proposal to further cap charitable deductions in the federal tax code is a threat aimed like a dagger at the heart of America’s charitable nonprofit entities, secular and religious,” Land said. “It will weaken most, kill many, and harm all.”

Robert Parham, head of the Baptist Center for Ethics, wondered in a Nov. 29 editorial what President Obama is thinking. “The nation needs to keep charitable giving as a noble priority—and one that is rewarded with a tax deduction,” Parham wrote for the center’s website EthicsDaily.com.

The Charitable Giving Coalition cites a study claiming that one-third of donors say they would reduce their giving if the tax deduction did not exist. Others say that impact is overblown. Warren Buffett, who gives away billions of dollars a year, said doing away with the deduction “would not change my charitable giving a penny."

Parham acknowledged the tax deduction is not the only reason, or even the major reason, people of faith give to charity.

“But it is an important reason for some folk who give significant gifts,” he wrote. “Charitable giving is fundamental to tens of thousands of houses of faith and their many institutions.”

The White House said Nov. 29 the president would not support a proposed $25,000 annual limit on deductions, including those for charitable giving, because the plan backed by Republicans and the bipartisan Committee for a Responsible Federal Budget would cost charities $10 billion a year and not raise enough revenue without also raising taxes on the top 2 percent of wage earners.

House Republicans sent a counterproposal to Obama’s budget Dec. 3 outlining a $4.6 trillion deficit-reduction proposal without raising tax rates. The White House rejected the proposal, saying the numbers don’t add up.

“There is no mathematically sound way to do it,” said White House Press Secretary Jay Carney. “And making vague promises about achieving revenue through capping deductions or closing loopholes simply doesn’t add up to a serious proposal.”

Carney called the GOP plan “wildly politically unfeasible, because it suggests that we would wipe out charitable deductions or other measures that might add up on paper, but simply aren’t plausible when it comes to getting something through Congress.”

A poll released Dec. 4 by the Pew Research Center for the People and the Press said Americans are pessimistic that the president and House Republicans will be able to reach a deal by Jan. 1 to prevent automatic tax increases and spending cuts from taking effect and possibly drag the economy into recession.

If America goes off the “fiscal cliff,” most Americans (53 percent) believe Republicans in Congress will be more to blame than Obama (27 percent), the poll showed.

 
< Prev   Next >
Copyright © 2007-2014 Word and Way, All Rights Reserved.