Tim Delaney, President & CEO of the National Council of Nonprofits, made the following statement in response to the tax reform proposal put forth by House Ways and Means Committee Chairman Dave Camp (R-MI):
“The National Council of Nonprofits urges charitable nonprofits to keep their advocacy efforts focused on activities in their state capitals and city halls rather than getting distracted by the latest federal tax reform proposal that is sure to generate lots of media attention. For the time being, charitable nonprofits should stay the course of focusing on the real legislative opportunities and threats in the states. In 2013, Congress enacted fewer than 80 bills, while states approved nearly 40,000 new laws. This year is likely to see the similar results.
“Nonetheless, Chairman Camp’s 979-page package should not be ignored. Over the next several months, its various components will be parsed and analyzed. For instance, the package contains a proposal – a two-percent AGI floor on charitable giving – that pleases economists who have been challenging charitable giving incentives for years. But their unproven theories could have devastating real-world consequences by diminishing charitable resources for communities.
“In recent years, similar theories for tinkering with charitable giving have been tried in the states – after endorsement by powerful Washington politicians – and the results have been disastrous. For example, the President’s proposal to cap itemized deductions was enacted in modified form in Hawai`i in 2011, only to be repealed for charitable giving in 2013 due to the harmful consequences to the community. Several other states considered the cap on charitable deductions in 2013 and largely rejected it. Likewise, the call to convert tax deductions into tax credits – a proposal seen in several other federal tax-reform packages – was seriously considered before being rejected in Minnesota last year.
“The charitable nonprofit community and the people they serve have a great deal at stake in the tax reform debate, which too often looks at the donors without considering community needs. For now, charitable nonprofits should focus their advocacy efforts in the states, where the challenges are real, and not be distracted by the headlines in Washington.”
The National Council of Nonprofits is a trusted resource and advocate for America’s charitable nonprofits. Through our powerful network of State Associations and 25,000-plus members – the nation’s largest network of nonprofits – we serve as a central coordinator and mobilizer to help nonprofits achieve greater collective impact in local communities across the country. We identify emerging trends, share proven practices, and promote solutions that benefit charitable nonprofits and the communities they serve. Learn more at www.CouncilofNonprofits.org.