Please Note
To return to the Archives page, please use the
Back Button on your browser or click HERE.

News and Information Archive

 

DAILY HEADLINE NEWS FEED | ARCHIVES OF PAST MONTHS

Deductions for Nonitemizers

On July 12, 2001, the House Ways and Means Committee passed legislation that would allow nonitemizers to write off a small portion of their gifts to charities beginning in 2002. Currently, if you itemize, you can generally write off the amount of your charitable contributions. However, only three in ten taxpayers itemize their deductions.

The House bill does not mean a windfall for taxpayers. Beginning in 2002, nonitemizers would be able to deduct up to $25 ($50 if filing jointly) in charitable contributions. In the 15% tax bracket, that would mean a tax saving of $7.50 on a joint return. The amounts would increase gradually to $100 in 2010 ($200 joint return) and a 15% tax bracket saving of $30.

The President had proposed higher limits, suggesting that nonitemizers eventually be allowed to deduct charitable contributions equal to the amount of their standard deduction (currently $4550 single and $7,600 married).

Other elements of the bill, along with the cost over 10 years, would:

• Allow taxpayers who are 70 1/2 and older to make charitable contributions from their individual retirement accounts without tax penalty: $2.2 billion.
• Let corporations deduct more of their charitable contributions, capping them at 15 percent of taxable income, up from 10 percent: just under $1 billion.

TOP OF PAGE

H.R. 7 Passed by House

After a one day delay to examine potential discrimination issues, fifteen House Democrats joined 217 Republicans and one independent to pass H.R. 7, the Community Solutions Act (CSA - the faith based initiative). House sponsor Rep. J.C. Watts (R-OK) proclaimed, "It's a good day. A lot of convictions and a lot of hard fighting on both sides, but I believe with every ounce of my being that we did the right thing today."

The bill includes several tax incentives for charitable giving, but also will enable religious organizations to be eligible for federal grants for assisting the impoverished, curing addictions and sheltering the homeless. The controversial portion of the bill is an exemption for religious organizations from state and federal laws against discrimination.

CSA supporters claim that it is essential for faith-based groups to be able to employ persons who agree with the tenets of their particular faith. Opponents claim that allowing Jews, Christians, Muslims and other faiths to receive federal funds and select their employees from members of their faith would be "authorizing and subsidizing religious discrimination." Senate Majority Leader Tom Daschle (D-SD) stated, "I can't imagine that we would pass any bill that would tolerate slipping back into a level of intolerance that would be acceptable in today's society." His comments suggest a much more difficult road ahead for CSA in the Senate in September.

Perhaps the most beneficial planned giving provision of H.R. 7 is Sec. 102. This section permits an IRA owner to make direct gifts to qualified charities and transfers to one or two life deferred gift agreements. This could facilitate major gifts to charity from the $3 trillion currently in IRAs.
From GiftLaw.com

TOP OF PAGE

Nonprofits Fuel Bigger Share of the Nation's Econmy

The number of nonprofits and their revenues and spending all grew in the past 10 years, as did their share of the gross domestic product, total employment and income, Independent Sector says in the report.

Average household contributions to charity also grew, along with the number of volunteers, while the share of households reporting contributions and the average time contributed by adult volunteers both fell.

Pat Read, vice president for public affairs at Independent Sector, a national coalition of nonprofits, says the sector is growing because “more people are seeing the need, and wanting to address it themselves by creating new organizations rather than working through established nonprofits.” And with increasing demand on Americans’ time, “fewer households are giving more intensely,” she says, adding that nonprofits are developing new models of volunteering to accommodate an increasingly busier and older population.

Growth also has attracted increased focus on nonprofits, says Read, former executive director of the Colorado Association of Nonprofit Organizations . “We’re a more diverse sector than ever before,” she says. “The competition to gain the attention of volunteers and donors is clearly getting more intense and it raises the bar for nonprofits to maintain the highest standards of accountability and performance.”

Among highlights of the report, The New Nonprofit Almanac In Brief, and trends based on the report:

• The number of charitable nonprofits grew to 734,000 in 1998 from 422,000 in 1987.
• Income of all tax-exempt nonprofits - including the value of volunteer time -- accounted for 6.7 percent of national income in 1998, up from 6.5 percent in 1987, while independent-sector groups accounted for 6.1 percent of national income in 1998, up from 5.7 percent in 1987.
• The average contribution to charity from households making a contribution grew to $1,075 in 1998 from $978 in 1989, while the percentage of households reporting contributions fell to 70.1 percent in 1998 from 75.1 percent in 1989.
• The average contribution for all households grew to $754 in 1998 from $734 in 1989.
• The number of volunteers grew to 109.4 million in 1998, or 55.5 percent of the adult population, from 98.4 million in 1989, or 54.4 percent of the adult population.
• But the average time contributed each week by adult volunteers fell to 3.5 hours in 1998 from 4 hours in 1989.
• The value of time contributed by volunteers grew to $225.9 billion in 1998 from $169.6 billion in 1989.
  By Todd Cohen nonprofitxpress.com

TOP OF PAGE

A Compromise Over Faith-Based Initiative?

With controversy continuing over President Bush’s plan to expand funding for religious groups that deliver social services, Bush is moving toward a compromise, and reports from states show a range of responses to regulation of religious groups.

Two senators say Bush has hinted he might agree to a deal to help speed Senate passage of his faith-based plan by forcing groups that get funding to comply with local anti-discrimination laws, Reuters reported July 26.

Legal experts say religious groups increasingly are securing exemptions from state laws ranging from land-use regulations to health requirements such as immunization, The New York Times reported July 27.

More than 12 states have passed or considered laws to bar state and local laws from interfering with religious practices or beliefs unless a state or city can show a compelling interest is at stake, the Times said.

The Times also reported July 21 that local officials are moving quickly to spur religious charities to seek government funds.

At least 15 states have named government officials to broker partnerships between clergy and state social service departments, the Times said.

And, five years after President Clinton signed a law letting states direct federal funds to religious groups, most states have not given any money to religious nonprofits and only a few have given significant money, Stateline reported July 11.

The reason, experts told Stateline, was bureaucracy, fear of legal challenges for constitutional violations, resistance by some officials, weak response from religious groups and weakness in the original regulation.
From www.npxpress.com (Nonprofitxpress)

TOP OF PAGE