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Nonprofits Ask Congress to Expand Charitable Giving Incentives

Posted on Mar. 20, 2020

Congress should expand the reach of the tax break for charitable donations to encourage more Americans to support charities during the coronavirus pandemic, according to a coalition of nonprofit organizations.

More than 50 nonprofits have asked lawmakers to establish a universal charitable deduction available to both itemizers and non-itemizers. This “above-the-line” deduction should be available through the end of 2021, they wrote in a March 18 letter.

Congress should also permit taxpayers who donate now to claim the deduction on their 2019 tax returns, the signatories said.

A bill introduced late March 19 in the Senate included recommendations from Finance Committee Chair Chuck Grassley, R-Iowa, and other committee Republicans to allow taxpayers to deduct up to $300 of cash contributions to charity regardless of whether they itemize and to increase the limitations on deductions for charitable donations by itemizers and corporations.

“The survival of many of America’s charities is jeopardized by unprecedented revenue losses from closed programming and services offered, as well as anticipated shortfalls in fundraising,” the letter said. “America’s charitable nonprofits, which are so essential to a healthy economy, need a reliable source of cash over the next several weeks and months to ensure we can continue to serve our communities.”

The nonprofits also requested tax credits for all charities, regardless of size, that provide paid family and medical leave. They praised the Families First Coronavirus Response Act (H.R. 6201), signed into law late March 18, which established a payroll tax credit for employers, including nonprofits, that provide emergency paid family leave and sick leave for coronavirus care.

“As is done in the Families First Coronavirus Response Act . . . any additional employment-focused relief or stimulus legislation must expressly apply to employment at tax-exempt organizations by making tax credits and deductions applicable not just to income taxes, but to the taxes nonprofits pay, such as payroll taxes,” the signatories wrote.

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