Tax reform could benefit giving community

A new study has surveyed the potential effects of universal deductions on giving

Tax reform could benefit giving community

Non-Profits & Charities

By Allie Sanchez

A new study commissioned by civic group Independent Sector has found that the tax reform policies proposed by the Trump administration could boost giving to the non-profit sector.

The study, conducted by the Indiana University Lily Family School of Philanthropy, said that while charitable giving could take a $5 billion to $13 billion hit under the proposed tax reforms by the Republican dominated legislature, these reforms could also offset the potential losses.

According to a report by The Non-Profit Times, the proposed universal charitable deduction for tax payers will not only erase the potential $13 billion loss in the giving community, but add another $1.1 billion to the $4.8 billion in charitable coffers across the country as well.

Furthermore, the study said that expanding the charitable deduction to non-itemizers, or those in the middle-income markets, could potentially increase giving by 1.3% to 4.3%, and will have a negligible effect on tax revenue (between -0.41% and -0.47%)

“We took the position last year that expanding the charitable deduction to 100% of taxpayers would encourage all Americans to give more and ensure that more dollars were being put back into communities,” IS president and chief executive Daniel Cardinali was quoted as saying in a statement.

“We are encouraged that the research shows that expanding the deduction has the potential to more than offset the estimated loss in charitable dollars resulting from current reform proposals,” he concluded.

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