Legislation

At the DMA Nonprofit Federation's 2012 Washington Nonprofit Conference, Gretchen Littlefield, president, nonprofit and government, at Infogroup, and Angel Aloma, executive director of Food For The Poor, discussed postal and tax topics and urged each and every fundraiser in attendance to take action and make his or her voice heard. Aloma, ever the passionate speaker, really drove his point home: "The biggest sin of all is the sin of doing nothing."

Perhaps I am overly optimistic, but it’s possible that tax reform could offer the potential to expand charitable giving, or at least not cause the decline that many fear. After all, the current system isn’t perfect. People who itemize are the only ones who can get a tax break for giving. This leaves a lot of taxpayers without a tax incentive to give.

Nonprofits criticized a plan offered by President Barack Obama on Tuesday that would limit the value of all tax deductions, including the charitable deduction, for wealthy taxpayers. In his budget proposal for fiscal 2015, which starts Oct. 1, Obama called for all deductions to be capped at 28 percent, saying the limit would only affect people whose incomes are in the top 3 percent. The change would affect individuals who earn more than $200,000 and couples who earn more than $250,000.

Nonprofit advocates slammed a plan offered Wednesday by the chief tax architect of the House that would sharply limit charity tax breaks for people at all income levels. Under the plan, people would be allowed to deduct only the amount above 2 percent of income they give to charity. That is a contrast to President Barack Obama’s repeated efforts to limit the value of the deduction only for people who are in the highest tax brackets — an idea charities have successfully fought throughout his administration.

During an informal wine and cheese reception at the 2012 New York Nonprofit Conference, Food for the Poor Executive Director Angel Aloma — ever the passionate public speaker — fired up the DMA Nonprofit Federation crowd with a rousing story he related to government affairs advocacy, of all things.

Nonprofit experts are confident the charitable tax deduction will emerge unscathed from the current session of Congress, but they are less certain how lawmakers will deal with several tax breaks for charities that expired at the end of 2013.

President Barack Obama has long pressed to limit the tax savings wealthy people can get for itemized deductions, including for charitable gifts, and he will likely reprise such an approach in his proposed budget next month.

Ted Hart speaks with nonprofit tax law expert Bruce R. Hopkins, author of "The Tax Law of Charitable Giving" series, on his Nonprofit Coach radio show.

Opponents of President Barack Obama’s proposed cap on charitable deductions say they have gotten a boost from a bipartisan letter by two Senate Finance Committee members that urges maintaining the tax break. Senators John Thune, a South Dakota Republican, and Ron Wyden, an Oregon Democrat, composed their letter last week and intend to deliver it to leaders of the Finance panel, Bloomberg BNA reports, as debate heats up revising the U.S. tax code.

Will opening up the field of crowdfunding business affect the market of donors to nonprofits? Some only see an upside, but will the ability of people with less wealth to contribute to development of business “crowd out” contributions to nonprofits? We would love to hear your thoughts on the matter.

Nonprofit organizations can be thankful for legal standards that benefit charitable organizations or make compliance with the relevant laws more straightforward, including in the following five areas: 1. donors and the tax deduction for charitable contributions; 2. boards of directors; 3. flexibility in structuring; 4. rebuttable presumption of reasonableness of compensation; and 5. uniform prudent management of investment fund laws.