- 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
- All Pages
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Budget Plan Revives President’s Call for New Charitable-Deduction Limits
President Obama renewed his proposal to limit the value of charitable deductions for wealthy taxpayers in the fiscal 2011 budget plan he presented – refashioning it as a way to help provide tax relief to middle-income Americans.
The president proposed a similar limit in last year’s budget as a way to help pay for a health-care overhaul, but it was not endorsed by Congress.
This year, he included it in a package of proposals that he sought to correct years of tax policies “that have disproportionately benefited high-income Americans and corporations” and produced a tax code that is “insufficient to meet national needs.” The White House said the change would raise more that $291-billion from 2011 to 2020.
Many nonprofit leaders and fund-raising consultants condemned the proposed limit, which would also apply to deductions for mortgage interest and state and local taxes, saying it would dampen giving at a time when charities are reeling from the economic downturn. Some, however, defended it as a way to bring more equity to the tax code while also helping to pay for health-care changes that would help nonprofit groups.
The president has paired the deduction limit with a proposal to end the tax cuts for wealthy Americans that were enacted during the Bush administration. That means the top tax bracket would rise to 39.6 percent next year, up from 35 percent now.
So, if Mr. Obama’s proposal is adopted, wealthy people will be paying more in taxes while getting less of a tax benefit for gifts to charity. The two proposals combined would increase the after-tax cost of making a charitable donation by almost 20 percent.