31 October 2017

ACR News 10.31.17 – Will Tax Reform be a Trick or Treat?

>> Federal: Washington Roundup
>> Federal: Universal Charitable Giving Act
>> Federal: Annual Meeting Recap
>> Federal: Roadmap for Action – November
>> Consider This: Expect a Bumpy Ride
>> Top ReadsPhilanthropy Horror Stories: Donor Intent Gone Wrong

It’s no trick. In fact, we’re giving you a treat with a Tuesday edition of the ACR Newsletter. The Philanthropy Roundtable’s Annual Meeting was last week, which is why you are getting this Halloween treat. There is just so much going on in the philanthropy tax world that we couldn’t let you miss even one update.

Washington Roundup

Last Thursday, the House took a major step to advance tax reform when it passed the Senate-passed budget resolution. This move fast-tracks the tax reform timeline, and enables Republicans to pass tax reform along party lines through a tool known as budget reconciliation. Ways and Means Republicans are expected to release at least some legislative text of their bill on Wednesday, and reports indicate a Ways and Means Committee markup to start Monday, November 6. Their goal is to hold a vote on the House floor the week of November 13.

The Senate Finance Committee may consider a bill as early as the week of the 13, but reports indicate Chairman Hatch (R-UT) will “lay down a mark” for the committee in the coming weeks, with no explicit timeline. We expect to know more when the House text is released (tentatively) later this week.

Universal Charitable Giving Act

As you may recall, Representative Mark Walker (R-NC) introduced the Universal Charitable Giving Act earlier this month. The legislation would make available a non-itemizer deduction for charitable contributions up to one-third of the standard deduction. ACR staff have been working with our colleagues in the Charitable Giving Coalition to address the potential consequences of a cap on the incentive.

The introduction of this legislation is a step in the right direction and rightly acknowledges the effectiveness of the charitable deduction as an incentive for taxpayers to support their communities. In the coming weeks, we look forward to working with Congressman Walker, his staff, and other members of Congress to advance his bill in tax reform.

Annual Meeting Recap

Last week, The Philanthropy Roundtable held their Annual Meeting in Scottsdale, AZ. As part of the programming, the Alliance for Charitable Reform held a panel on tax policy and charitable giving featuring Robert Sharpe, Chairman of Sharpe Group, and Sandra Swirski, ACR executive director. Pete Bird of the Frist Foundation moderated. You can see video coverage of the panel below.

ACR also hosted a discussion on philanthropy and democracy at the Annual meeting. While some are concerned that wealthy philanthropists may be playing too large of a role in affecting and influencing their fellow citizens’ lives, advocates for philanthropic freedom counter that efforts to limit the ability of Americans to support the organizations and causes they believe in will diminish freedom and politicize charitable giving. Rob Reich, director of the Center for Ethics in Society at Stanford University and co-editor of Philanthropy in Democratic Societies: History, Institutions, Values, and Heather Higgins, president of the Randolph Foundation and co-founder of the Alliance for Charitable Reform, discussed the issue.

Roadmap for Action – November

At the ACR Summit for Leaders in March, we presented a Roadmap for Action – a 12-month plan to engage with lawmakers and your community.

We then hosted a webinar in April for those who may have missed the Summit.

November’s action item is to write a letter to the editor of your local news outlet, which is especially timely considering the tax reform actions this month. You can find all the resources you need here.

We also want to share in your successes! October’s action item was to invite lawmakers to your organization. If you took a photo during their visit and you would like to share it with us, please email it to sbarba@urbanswirski.com. Some examples of how to share on social media can be found here.

Consider This – Expect a Bumpy Ride

While the news of the latest in Robert Mueller’s investigation took center stage this week, let’s not forget about tax reform!

Late last week, the House approved the Senate version of a budget in a 216-212 vote. That vote paves the way for tax reform that will need just 50, not 60, votes in the Senate. The President wants a tax bill on his desk to sign by the end of the year.

So what does this mean going forward?

As is so often the case, the devil is in the details. While the budget that just passed is a 30,000 foot look at a budget and taxes, we expect House Republicans to release a detailed tax plan draft sometime this week. A 216-212 budget vote doesn’t leave a lot of wiggle room for a tax bill draft that we expect to create some clear “winners” and “losers.” Getting a tax bill across the finish line may be no easy feat.

That being said, the rules governing the House makes getting results a lot easier than in the Senate.  If we had to guess, we predict the House process will be messy, but the House will pass a tax bill in relatively short order. The hang-up in getting that bill signed into law will be the Senate. With only three votes to spare, Republicans will be balancing on a narrow beam; and they may not be successful on their first try, which is why Senate Minority Leader Schumer has been looking ahead and saying Democrats are willing to work with Republicans on a 60, not 50, vote bill.  House Minority Leader Pelosi isn’t there and it will be interesting to see if she ultimately might get there.

Expect a bumpy and intense ride on taxes over the next few months. And count on us to keep you posted as events unfold.

Top Reads

Please feel free to email us at info@acreform.com if you have any questions, stories or topics you would like us to include in our newsletter.

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