Monday, October 31, 2011
In Giving’s “Perfect Storm”; Proposed Limits on Tax Deductions Worry Leaders of Nonprofits, the Chicago Tribune reports that over 1,000 philanthropic leaders and nonprofit executives will meet at the Independent Sector Annual Conference in Chicago this week to discuss a number of pressing issues, including proposals to limit the federal income tax deduction for charitable donations. One such familiar proposal has come from President Obama’s administration, which wants to limit the benefit to a taxpayer from the income tax deduction for charitable contributions to 28% thereof. The story reports that Diana Aviv, president and CEO of Independent Sector, cites studies estimating that the proposal could cost nonprofits $ 7 billion. Charities are particularly concerned with the reduction in donations any such proposal could cause in view of their current financial circumstances. First, donations are harder to attract with the poor economy. Secondly, because state governments have decreased funding of social services, the need for nonprofits to fill the void is greater than ever.