By: Rick Dunham, CEO
Yesterday, the White House released its proposed tax reform (PDF), indicating that one goal would be to protect the charitable tax deduction. However, what is being proposed could negatively impact charitable giving.
First, the proposal to double the standard deduction will mean that millions of Americans will no longer itemize their deductions, which will directly impact charitable giving. Tax reform does impact charitable giving as Hawaii learned back in 2011 when their cap on deductions cost the charitable sector in Hawaii $60 million in donations and only generated $12 million in tax revenue.
As a member of the Charitable Giving Coalition, Dunham+Company joins the call to protect the support of charity by establishing a universal charitable tax deduction that allows all Americans a charitable giving deduction regardless of their level of income.
Another policy that could impact charitable giving is eliminating the “death tax”.
In the latest Giving USA data for 2015, over $30 billion was given to charity through bequests. Eliminating the estate tax will remove a key incentive for leaving a bequest gift to charity and we believe would lead to a decrease in this type of charitable gift.