July 2, 2010
Charitable Contributions Deduction under New York State Law Could Be Limited for High Income Taxpayers
The Chronicle of Philanthropy reports that a proposal to reduce the charitable contributions deduction allowed for individual donors who are “high earners” is facing resistance from nonprofits. Governor David Paterson and the state legislature have reportedly agreed on legislation that would permit New York taxpayers who earn more than $10-million annually (a pool of about 3,500 people) to deduct on their state income tax returns only 25 percent of their charitable contributions, rather than 50 percent as permitted by current law. The amendment reportedly could raise $100-million in revenue, according to the New York State Division of the Budget. But the state’s potential gain could be charities’ loss. Says the article:
“Many charities and nonprofits in New York City are outraged by this last-minute proposal to raise money, saying it would discourage many wealthy individuals and businesses from wanting to give, especially at a time when not-for-profits are reliant more than ever on charitable donations to survive the recession,” said the Human Services Council of New York City, in a statement.
Michael Stoller, executive director of the Human Services Council, added: “Any proposal that could possibly decrease private giving is going to be a disaster for all nonprofits in New York City and throughout the state. The state cannot balance the budget on the backs of those in need.”
The New York City Employment & Training Coalition urged organizations to contact lawmakers to plead that the charitable-contribution deduction for wealthy individuals be left alone.
“This affects your donors and their incentive to support your programs,” the coalition said. “Harsh state and city budget cuts already threaten our programs. Private donations are one of few ways to raise the revenue we need.”
July 2, 2010 | Permalink
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