- March 2010
- Many Nonprofit Programs Hold Even or See Gains in Obama’s 2011 Budget
- Congress Passes Plan to Encourage Cash Donations for Haiti Relief
- Budget Plan Revives President’s Call for New Charitable-Deduction Limits
- Supreme Court Campaign-Finance Ruling Could Aid Nonprofit Advocates
- Obama’s $50-Million Fund to Spur Innovation Gets Underway
- Senate and House Pass Jobs Bills with Tax Credits for Non Profit Employers
- Fundraisers Challenging Utah’s Registration Requirements
- Notre Dame Gets First Property Tax Bill from Indiana County
- Court Rejects Texas Rules on Solicitation Disclosure
- States and Local Governments Considering Taxing Non Profits
- Arizona Takes Donor’s Gift
- MA Non Profits May Lose Out Following Madoff Case Ruling
- IRS Gives Haiti Special Disaster Status
- Recent Estate-Tax Changes Did not Make Big Difference to Charitable Gifts
- IRS Adjusts Levels for Nominal Value Premiums
- Postal Service May Increase Rates and Reduce Service
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Congress Faces Key Matters for Charities and Donors in the New Year
As Congress returns to work after its winter break, lawmakers are taking up several key issues important to charities and donors. Among them:
Estate tax. In 2001 Congress passed the current estate-tax law, which gradually phased out the tax through 2009 and repealed it for 2010. However, in 2011 the current law is set to expire and estate-tax levels that applied years earlier at higher rates are scheduled to go back into effect.
The House of Representatives last month passed a bill that would eliminate the 2010 repeal and permanently keep the estate tax at levels that were in effect in 2009. Because the Senate has not yet voted on the provision, no estate tax exists currently.
The estate tax that applied in 2009 allowed heirs to exempt $3-5-million ($7-million for couples) and face a top tax rate of 45 percent. The estate tax that is scheduled to apply in 2011 would provide an exemption of $1-million and a top tax rate of 55 percent.
Health care. The House and Senate are working to merge their separate bills to overhaul the health-care system. Provisions currently in both bills would require nonprofit employers to offer their workers health insurance or pay a tax. The Senate bill would allow small nonprofit groups to qualify for tax credits if they offer health coverage to employees, but the House bill offers such credits only to for-profit employers. The Senate bill also adds new requirements for tax-exempt hospitals. One would have such hospitals conduct a “community health needs assessment” every three years.
The White House more recently released its own formal health care proposal which reflects many of the compromises discussed between the House and Senate. The proposal does not include restrictions on the tax deductibility of charitable gifts.
Charitable Tax Incentives. The House in December approved legislation that would extend for another year a variety of charitable tax incentives that expired at the end of 2009. The Senate has not voted on the proposal.
The legislation would allow people age 70 ½ and older to again make charitable donations of up to $100,000 a year from their individual retirement accounts without having to pay taxes on the distribution. The measure would also extend tax incentives to encourage donations of property, food inventory, books to public schools, and computer equipment for educational purposes.
Pensions. Congress has not acted on a bill introduced by two House members that would ease rules that govern how charities and other employers make payments to defined-benefit pension plans, which provide specific amounts to retired workers. The stock-market crash has left many nonprofit groups struggling to set aside money for future payments to retired employees.
Volunteerism. The House passed a jobs bill that included $200-million in fresh money for the AmeriCorps, the national-service program. The Senate has not taken up the measure. The money provided in the Jobs for Main Street Act, would allow AmeriCorps to add 25,000 members as part of a broader effort to tackle the country’s high unemployment rate by creating and saving public-service jobs.
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