Protect charitable deduction during sequestration talks!
This is an excerpt of a statement by the Independent Sector:
...As part of the effort to put forward a plan that could avoid sequestration, the president will include a 28 percent cap on the charitable deduction. Even though the administration has expressed a commitment to ensuring that the cuts do not fall disproportionately on those least able to bear them, this action to cap the charitable deduction does not penalize those taxpayers who claim it, but the millions of individuals, families, and communities who rely on the programs and services provided by America’s nonprofit and philanthropic sector.
Experts estimated that when top marginal rates were 35 percent, capping the charitable deduction at 28 percent would have reduced charitable giving by as much as $7 billion a year. With an even wider disparity now between tax rates (39.5 percent) and the president’s proposed cap at 28 percent, the reduction in giving could be even more severe, and any decrease in giving would come on top of the nearly $20 billion drop in annual giving since the economic downturn began in 2007.
Charitable organizations have been asked for too long to meet increased demands for programs and services in the face of dwindling revenue from federal, state, and local government. It is simply unconscionable to ask them to now endure the reduction in giving that will be driven by a cap on the charitable deduction.
We urge the president to protect giving and preserve the charitable deduction at its current levels of 39.6 percent for high income earners. Details: www.independentsector.org.
