Charities unhappy with the limits on a recent expansion of the tax incentive for charitable donations are pinning their hopes on a bill that would remove the cap.
The Save Organizations That Serve (SOS) America Act (H.R. 6408), introduced March 27 by Reps. Seth Moulton, D-Mass., and Brian K. Fitzpatrick, R-Pa., would establish a permanent universal charitable deduction for both itemizers and non-itemizers.
Notably, the legislation would eliminate the $300 cap placed on the temporary universal charitable deduction established by the Coronavirus Aid, Relief, and Economic Security (CARES) Act (P.L. 116-136). Groups representing charities have argued that the $300 limit won’t do enough to address the expected decline in charitable giving caused by the coronavirus pandemic.
H.R. 6408 would also allow donations made after March 1 to be claimed on 2019 and future tax returns, thereby fulfilling another wish of the charitable sector.
The bill has 20 cosponsors and enjoys the support of more than two dozen charities. Independent Sector is asking its members to promote the legislation to lawmakers, and an April 8 letter to congressional leaders from more than 200 nonprofits asks Congress to increase the $300 cap and extend the effective date of the incentive.
The nonprofit groups also suggested allowing charitable donations made between March 13 and July 16 to be deducted on 2019 returns.
These changes would “encourage all Americans to help their communities through charitable donations during these challenging times,” the letter says.
In an April 6 letter, Moulton urged House Ways and Means Committee Chair Richard E. Neal, D-Mass., to support his bill.
“The legislation . . . would ensure that nonprofits are not left behind in disaster relief,” Moulton told Neal.