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>> Top Reads: New Trump Tax Plan Caps Charitable Deductions
The House and Senate were in session this week and passed a continuing resolution on Wednesday to fund the government through December 9. Most lawmakers left town yesterday to return to their home states to campaign for the final weeks before the election. This sets up another year-end spending battle, which we expect could include a sizable tax bill. Should that be the case, we are prepared to urge lawmakers to include provisions important to the sector, including the streamlined private foundation excise tax and expansion of the IRA rollover to include distributions to donor-advised funds.
On Wednesday, September 21, the Senate Finance Committee held what we expect to be the last markup of a tax bill for the year. The legislation included a variety of provisions, most of which are aimed at retirement savings. No charitable provisions were included or mentioned.
On Thursday, September 22, our colleagues at Independent Sector hosted a briefing on the recently completed poll about the role of the charitable sector in policymaking. The unifying theme of the results is that Americans support the charitable sector having a larger role working with the federal government to produce effective and efficient solutions to social problems. According to the findings, 88 percent of voters believe it should be easier to deduct charitable contributions from their taxes, and 74 percent said they trust charities with their checkbooks more than the federal government and want to see expanded access to charitable giving. These findings will be especially helpful when making the case to lawmakers that the charitable sector should be top-of-mind during any kind of policy reform.
The first Presidential debate was held on Monday, September 26, and tax reform was one of the first items on the agenda. Donald Trump touted his tax cuts, which he claims would grow the economy by providing relief to some of the wealthiest taxpayers, while Hillary Clinton defended her tax hikes on the rich. The candidates did not mention the charitable provisions in their respective tax plans, but Clinton briefly suggested Donald Trump might not be as charitable as he claims.
You may recall that Donald Trump released a revised tax plan on Thursday, September 15, that would cap itemized deductions at $100,000 for single filers and $200,000 for married couples filing jointly, including the charitable deduction. According to the Tax Foundation’s September 19 analysis, the plan would reduce federal revenue by between $4.4 trillion and $5.9 trillion on a static basis, or between $2.6 trillion and $3.9 trillion when accounting for economic growth. We are working with colleagues in the sector to connect with the campaign and urge them to maintain the full scope of the deduction.
On Thursday, September 22, Democratic presidential nominee Hillary Clinton quietly updated her campaign website with a revised estate tax hike, similar to Senator Bernie Sanders’ (I-VT) proposed increase. Clinton originally favored a top estate tax rate of 45 percent, but in this update, she is now proposing a 50 percent rate for estates worth more than $10 million, 55 percent for those worth more than $50 million and 65 percent on billion-dollar estates. As you may recall, Republican nominee Donald Trump has voiced support for getting rid of the estate tax entirely.
Donald Trump and Hillary Clinton met on a debate stage for the first time earlier this week. And suffice it to say for viewers, it was not a boring affair.
All topics – big and small – appeared to be on the table. But one topic remained untouched despite being controversial for both candidates – the activity of their respective family foundations.
Clinton’s campaign, along with the President, have been aggressive in criticizing questionable payments by his foundation. In the President’s words, Trump “took money other people gave to his charity and then bought a six-foot-tall painting of himself.” At the same time, Clinton’s Foundation has been under attacks of “paying to play” by soliciting donations from people seeking access with her at the State Department.
While Clinton raised the possibility of Trump giving little or nothing to charity, she stopped short of homing in on his foundation. Does that mean the issue is going away for either of them? Hardly. Since they both have the same weakness, the candidates themselves won’t be the ones raising that weakness as an issue. Instead, expect their respective campaigns and surrogates to raise the issue – and be mindful that there are two more debates still scheduled so anything could happen. We just hope these discussions do not paint a broad brush and tarnish our sector.
- National: New Trump Tax Plan Caps Charitable Deductions
- National: Trump’s tax deduction change upsets charities
- National: How the IRS Helps the Rich Get Richer
- National: Survey: Charities Should Get More Legislative Support
- National: Giving Is Not Only Good for You, It’s Good for Your Taxes
- National: New IRS Rule Opens Tax Saving Strategy To Art Collectors
- National: Nonprofits Worry About Election’s Impact on Public View of Charity
- National: A Platform for Ambition
- Local: Federal Judge Halts ‘Timeshare Donation Scheme’ Pitched In Kansas City
- Opinion: How Generous Are the Candidates? Should Voters Care?
- Opinion: Science Shows Trump’s Charity Scandal Hurts All Nonprofits
- Opinion: Chan Zuckerberg Science Is a Model for Big Donors
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