Charities-Only Tax Bill Nearly Passes in the House

Charities-Only Tax Bill Nearly Passes in the House

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The work of charitable nonprofits in communities throughout the United States fell just a few votes short of receiving a boost by Congress last week when the Supporting America’s Charities Act, H.R.5806, was introduced, debated, and voted on by the House of Representatives. H.R. 5806 sought to make permanent three charitable giving tax incentives: allowing older Americans to make IRA rollovers for charitable purposes without suffering tax consequences; promoting an incentive for donations of conservation easements to protect the environment; and making it easier for farmers and small businesses to donate food to community food banks. The bill was deemed necessary because separate House-passed legislation (H.R.5771) to provide a so-called “one-year” extension of 50+ expired tax provisions would have the effect of promoting charitable giving for less than three weeks – from the date President Obama signs the bill until December 31, 2014 when the tax provisions expire again. Although a majority of the House voted in favor of H.R.5806, the bill needed support from two-thirds because of the procedural rule that allowed expedited consideration. The final vote was 275 to 149, with 47 Democrats joining 228 Republicans in support of the bill – 65 percent of the vote, eight votes short of the two-thirds needed to pass. Ultimately, the bill failed because the House Democratic leadership and the White House worked hard against the bill, which they reportedly opposed because the tax cuts were not directly offset with revenue increases and they saw it as a precedent-setting test of the power of the President’s veto threat. For more information, see the Nonprofit Community Joint Statement to House leaders, a December 11 ad in Politico, and the statement of the National Council of Nonprofits.

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