Rich Donors May Be Undeterred by Tax Caps on Charitable Gifts

In 2008, the second-highest tax bracket kicked in at taxable income of $164,550 for single taxpayers and $200,300 for married couples. The top bracket last year was triggered at $357,700 for both groups; by 2011, both figures will be higher as they are adjusted for inflation annually.

Under Obama’s proposal, a taxpayer in the top bracket who donates $1,000 to charity would get a tax savings of $280 instead of $396 without the change. A taxpayer in the second- highest bracket would lose $80 in tax savings. The proposal would also limit tax savings for other write-offs including mortgage interest, state and local taxes paid, and medical expenses, among other itemized deductions.