Obama’s proposed changes may hinder nonprofit donations

During a news conference Tuesday, President Barack Obama defended his controversial proposal to cap tax breaks for the wealthiest Americans on charitable gifts and use the revenue to help fund his health-care overhaul. While the majority of Americans can write off 28 percent of their salaries in itemized deductions, according to a recent Los Angeles Times article, the wealthiest one percent can currently write off 39 percent.

Obama’s plan would set deduction limits at 28 percent for everyone, including the wealthy. While Obama defends his plan by saying that these limits would equalize tax kickbacks by allowing all Americans to receive the same incentives to give charitably, many in the nonprofit world are worried that this action will make it harder to get donations from wealthy Americans, especially as overall giving has dropped significantly as the economy has soured.

According to a Chronicle of Philanthropy article, those in the nonprofit sector are divided on the impacts of this proposed change. While many think it will lower giving levels, others feel that the effects will be slight, and, as Obama said during his news conference, the economy will be the biggest barrier to donations, not his proposed tax caps.

What do you think? Will Obama’s plan hurt charitable donations, or do the country’s economic problems overshadow the possible results of this change? Are the benefits that America will see from a health-care overhaul worth the possible strain these cuts may put on charitable giving?

This entry was posted in Economy and tagged , , , , . Bookmark the permalink.

JVA welcomes your comments and feedback on all Nonprofit Street articles. While JVA will post all relevant comments, it will not post comments that are advertising products or services or those with obscenities. Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s