
The nonprofit sector faces an “all-hands-on-deck” moment to lift more voices to protect the charitable giving incentive. (See the first story, below.) That’s why I am urging you and other nonprofit leaders to join the nationwide advocacy campaign by immediately encouraging all of your members, board members, staff members, volunteers, donors, service recipients, families, friends, and other people who care about the vital services and programs that nonprofits provide in local communities to contact their federal policymakers. The common message: The Supercommittee needs to make a clear statement in support of the charitable deduction and dislodge it from any proposals to cap or reduce the value of itemized deductions. Nonprofits cannot withstand any weakening of the charitable giving incentive, and governments at all levels cannot continue to cut public programs and expect nonprofits to fill in their gaps and pick up their slack.
Please protect those you serve in your communities by taking these two simple steps:
- Personally contact your U.S. Senators and Representative (find contact information and key messages here) by calling (202-225-3121), emailing, and/or tweeting; and
- Then forward this communication to all you know who care about the vital work that nonprofits do in our communities, urging them to take these two simple steps immediately because the supercommittee is deciding this now!
By taking these two steps, you can lift your voice and mobilize your special networks across America.
Thank you,
Tim Delaney
President & CEO
Supercommittee Deliberations Focus on Deductions
Democrats and Republicans on the Joint Select Committee on Deficit Reduction last week exchanged proposals to reduce the federal deficit. Details have been sketchy as the Supercommittee moves into sensitive negotiations with less than 10 days to reach a non-amendable plan. Each side’s proposal reportedly calls for limiting the value of some or all itemized deductions, such as the charitable giving incentive. The negotiators appear to be focusing on a proposal by economist Martin Feldstein to cap the value of all itemized deductions (e.g., for charitable giving, mortgage interest, and state and local sales taxes) at 2 percent of adjusted gross income (AGI). If adopted, that would mean that someone earning $100,000 could only take a total of $2,000 in itemized deductions, which for most people who currently itemize would be consumed entirely by their mortgage interest and/or their state and local taxes – thus eliminating any incentive to give to charity.
Although some of Feldstein’s writings have suggested that Congress may want to exempt charitable giving from the cap, the limited details released so far about the parties’ two proposals do not mention this option, thus increasing concern for the work of nonprofits. The National Journal reported that “Republicans said that tax deductions for second homes and charitable deductions could be slashed or eliminated as part of the agreement, with Bush tax cuts permanently extended and corporate tax rates possibly reduced.” Others report that the Democrats’ proposal includes a two-step process which identifies itemized deductions as a revenue-generating “placeholder” provision that would be triggered in January 2013 if tax reform legislation is not enacted in 2012.
Last Monday, every member of the Supercommittee received the Nonprofit Community Letter – now signed by more than 4,000 nonprofits from all 50 states – telling Congress that nonprofits cannot withstand any weakening of the charitable giving incentive, and government cannot continue to cut public programs and expect nonprofits to fill in their gaps and pick up their slack. See who has signed so far. The letter, which continues to draw signers because of the urgency of the threat, is also being delivered to every elected official in Congress.
The panel members have until November 23 to come up with a plan, after which an automatic trigger of $1.2 trillion in cuts is imposed on federal domestic spending and defense spending under the Budget Control Act passed in August.