Charitable Giving Tax Deduction Act
A bipartisan bill, the Charitable Giving Tax Deduction Act, was introduced today by Congressman Chris Smith (R-NJ) with Rep. Henry Cuellar (D-TX) as an original co-sponsor, to protect taxpayers and encourage charitable giving.
“Charitable organizations, including churches, synagogues, and other religiously-based entities, are the life-blood of services to those in need in our society, and I am committed to a tax policy that amplifies their ability to serve our community,” said Rep. Smith. “Americans have been generous patrons of charitable causes, and we want to ensure that everyone has the support they need to continue their generosity to charitable and philanthropic causes.”
“It is always important to give back to the community,” said Congressman Cuellar. “This bipartisan bill not only encourages us to help our fellow neighbors, but it also makes sure that taxpayers can receive their due deduction for charitable giving if they choose not to itemize. I am glad to support this legislation that will encourage charitable actions.”
Smith’s bill would make charitable tax deductions universal and “above-the-line,” allowing all taxpayers the option to write off charitable donations on their taxes whether or not they choose to itemize, providing maximum relief for those looking to donate to tax-exempt charitable organizations. The amount of charitable contributions would not be capped under Smith’s legislation.
The bill is supported by a consortium of charitable and faith-based organizations and philanthropic networks, including Agudath Israel of America, the Union of United Orthodox Jewish Congregations of America, the New Jersey Catholic Conference, United Way Worldwide, the Animal Welfare Institute, the Council on Foundations, the National Association of Charitable Gift Planners, the Faith & Giving Coalition, the American Littoral Society, the New Jersey YMCA State Alliance, the Alliance for Charitable Reform, Independent Sector, and the Humane Society Legislative Fund.
“Charitable giving is profoundly important for our nation, perhaps more now than ever before,” stated Rabbi Abba Cohen, Vice President for Federal Affairs of Agudath Israel of America. “Particularly at a time when government deficits loom, charities are being asked to step up and provide services that help address our nation’s most pressing needs. Representative Chris Smith’s legislation will enhance the charitable deduction in a way that will lead to increased giving, ultimately making it easier for nonprofits to continue to perform their vital work for all Americans.”
Nathan Diament, Executive Director for Public Policy for the Union of Orthodox Jewish Congregations of America – the country’s largest Orthodox Jewish umbrella organization – welcomed the legislation. “We at the Orthodox Union are grateful for Rep. Smith’s tireless efforts to bring this bill to fruition. Nonprofit groups, including the Orthodox Union, depend on taxpayer support to carry out our work, and this legislation will encourage people to make much-needed contributions that will strengthen charitable organizations across the country,” he said.
“Due to the increase in the standard deduction and the elimination of many other deductions, it is expected that fewer people will itemize and thus will be unable to claim charitable donations—a particular burden for small donors—which we presume will lead to a decline in such giving. There is no way to sugarcoat what this decline will mean—a reduction in the vital and necessary work of the organizations that depend on such revenue,” Cathy Liss, President of the Animal Welfare Institute, stated. “This covers every aspect of society, from ensuring the humane treatment of animals to providing meals to the elderly and shelter to the homeless, from after-school enrichment programs for children to countless other endeavors.”
Under the bill, “taxpayers will once again be encouraged to support charitable activities that serve so many needs in our communities,” Liss stated.
“United Way applauds Congressman Smith’s recognition that charitable giving in America has long been – and must continue to be – driven by the middle-class,” said Brian Gallagher, United Way Worldwide President and CEO. “At a time when too many people think giving is only for the wealthy, Congressman Smith’s legislation makes it easier for more people of all income levels to give and have a voice in the community-building process. We deeply appreciate Congressman Smith’s and Congressman Cuellar’s willingness to work across party lines and lead on a critical issue for all Americans, and particularly those in need.”
“A true universal deduction is critical to correcting the impact of last year’s tax legislation,” said Vikki Spruill, President and CEO of the Council on Foundations. “At its core, our nation’s charitable giving policies should encourage and enable those small and medium-sized donors who serve as a powerful engine in the sector’s ability to assist communities. This legislation brings those givers back into the fold by expanding the charitable deduction to millions more.”
“Philanthropy and generosity are hallmarks of American society, and charities serve an important role in providing services and helping others,” said Michael Markarian, Chief Operating Officer of The Humane Society of the United States. “We urge Congress to support Representative Smith’s bill to help taxpayers and encourage charitable giving.”
The New Jersey Catholic Conference stated its support for Smith’s bill: “The New Jersey Catholic Conference thanks Congressman Smith for introducing this important legislation. Every year, New Jersey Catholic Charities agencies assist hundreds of thousands of individuals and families to meet their most basic needs. Their ability to provide quality services depends upon charitable donations. Unfortunately, The Tax Cut and Jobs Act of 2017 makes charitable giving increasingly more difficult. The tax code should help not hurt nonprofit organizations tasked with serving the most vulnerable in our society. Congressman Smith’s bill would protect those revenue sources that are vital to the assistance of so many in need.”
“This is a critical piece of legislation that will allow all Americans, regardless of their income level, to receive a tax benefit for charitable giving. The bill therefore not only recognizes the great importance of philanthropy in this country, but it has the potential to unlock millions and millions of dollars in new charitable giving. We applaud Rep. Smith on his leadership on this issue,” Michael Kenyon, President and CEO of the National Association of Charitable Gift Planners, stated.
“By ensuring that taxpayers at all income levels can deduct their charitable gifts, this legislation can strengthen America’s houses of worship and faith communities and increase fairness in the tax code. We want an America where all—not just the wealthy—are encouraged to contribute to their communities through faith-based and other charitable organizations,” Brian W. Walsh, Executive Director of the Faith & Giving Coalition stated.
“Preserving the deductibility of charitable contributions is critically important to supporting conservation work,” Tim Dillingham, Executive Director of the American Littoral Society, stated.
“The YMCAs across New Jersey rely on charitable giving to provide essential programs and services that benefit communities across the Garden State,” said Dr. Darrin Anderson, Executive Director of the NJ YMCA State Alliance. “I applaud Rep. Chris Smith for his leadership in promoting increased charitable giving by creating an above-the-line, universal charitable deduction that would help protect the benefits of charitable giving for all taxpayers.”
“Independent Sector is proud to support the Charitable Giving Tax Deduction Act,” said Daniel J. Cardinali, President and CEO of Independent Sector. “Expanding the charitable deduction to all taxpayers will help civil society thrive and allow the charitable community to better serve their missions on behalf of communities across the country.”
“While total giving remains robust, the number of American households who give to charity has declined every year for the last decade. The Charitable Giving Tax Deduction Act is a bipartisan solution to this alarming trend and will bolster America’s vibrant and independent civil society. We applaud Reps. Smith and Cuellar for introducing this legislation and for acknowledging that charitable gifts from all Americans should be recognized regardless of income,” said Sandra Swirski, Executive Director of the Alliance for Charitable Reform.