A bipartisan group of lawmakers has reintroduced legislation to enhance the tax break for charitable giving during the COVID-19 pandemic.
The Universal Giving Pandemic Response and Recovery Act, introduced March 9 in both chambers of Congress, would allow non-itemizers to claim a below-the-line charitable giving deduction of up to one-third of the standard deduction — about $4,000 for individual filers and $8,000 for those married filing jointly.
The provision would be available for tax years 2021 and 2022.
“In a world that has changed significantly in the last year, we have seen more than ever the need to encourage giving to local nonprofits and houses of worship to support their selfless service to those in need,” Senate Finance Committee member James Lankford, R-Okla., said in a release announcing the bill. Lankford introduced similar legislation (S. 4032) in the last Congress.
In addition to Lankford, other Senate cosponsors are Finance Committee members Tim Scott, R-S.C., and Catherine Cortez Masto, D-Nev.; and Sens. Christopher A. Coons, D-Del., Mike Lee, R-Utah, Amy Klobuchar, D-Minn., and Susan M. Collins, R-Maine.
Rep. Chris Pappas, D-N.H., introduced the House version alongside Ways and Means Committee member Jackie Walorski, R-Ind.
“I am proud to introduce bipartisan legislation that will expand the charitable giving deduction to support the work of our nonprofits while also highlighting and rewarding the charitable spirit of our nation during these difficult times,” Pappas said.
Groups representing philanthropy and nonprofits welcomed the legislation.
“Incentivizing all taxpayers to give to charity — regardless of their income or whether they itemize — ensures that nonprofits doing critical work in our communities will receive the resources necessary to help as many Americans as possible,” said Brian Flahaven of the Charitable Giving Coalition.
The legislation is more generous than the $300 above-the-line charitable deduction established by the Coronavirus Aid, Relief, and Economic Security Act (P.L. 116-136). A COVID-19 relief bill (P.L. 116-260) enacted at the end of 2020 raised the cap to $600 for joint filers while leaving the amount at $300 for individuals, and it extended the deduction through 2021.
Members of the charitable giving community, though grateful for the CARES Act provision, have argued that the $300 figure should be raised. In January, 74 charitable organizations called on President Biden and congressional leaders to sharply increase the $300 amount and extend the deduction through at least 2022.