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Author Archives: Lisa Chiu
October 13, 2011, 9:44 am
Senate Hearing Puts Focus on Charitable Deduction
President Obama’s effort to limit deductions for wealthy people, including those for charitable gifts, in his jobs bill may have died last week, but charitable deductions will be front and center in a Capitol Hill hearing next week.
The Senate’s powerful Finance Committee will host a hearing next week that will discuss how some key proposals to change the federal tax code would affect nonprofits.
Testifying at the hearing will be Brian Gallagher, president of United Way Worldwide, and Dallin H. Oaks, a leader of the Church of Jesus Christ of Latter-day Saints. Other witnesses include government and college scholars who have examined the charitable deduction.
The hearing will take place Tuesday at 10 a.m. Eastern time and will be broadcast online.
To see more about the charitable deduction, go to this special section of The Chronicle’s Web site.
October 6, 2011, 6:14 pm
Price Tag for Charity Tax Break Loss: at Least $2.9-Billion
President Obama’s plan to limit the value of charitable deductions for wealthy people would cost nonprofits at least $2.9-billion and perhaps as much as $5.6-billion, according to a study to be unveiled Friday.
Economists examined how people would be affected by Mr. Obama’s plan to limit to 28 percent the amount affluent people could write off in all itemized deductions. People in the highest income bracket now can write off 35 percent of their deductions, including those for gifts to charity.
Charities have been strongly opposed to Mr. Obama’s effort to limit the incentive to give, especially at a time when giving has dropped because of the bad economy.
The new research will be presented Friday at a conference by the Urban Institute’s Center on Nonprofits and Philanthropy and was one of several forthcoming projects paid for by a $1-million research grant from the Bill &…
October 6, 2011, 9:46 am
State Regulators Grapple With Best Ways to Police Social-Media Appeals
As nonprofits increasingly turn to social-media and mobile tools to raise money, charity regulators are trying to figure out the smartest ways to protect donors from fraud.
The annual gathering of state regulators who monitor charities, held in Silver Spring, Md., this week, was dominated by concerns that the explosion of social networks has created an online fund-raising culture that is akin to the wild west.
The challenge, regulators say, is that the law and the courts haven’t kept up with all the changes, making it difficult for regulators to figure out which groups in their states are raising money online and how best to pursue organizations that defraud charities and donors.
Jeremy Sher, president of the Grassroots Giving Group, a Boston company that is developing an online-giving site, said he shares those concerns, even though regulations would mean more work for groups …
September 19, 2011, 6:03 pm
White House and GOP Trade Charges on Charity Write-Offs
The White House says its proposal to limit the write-offs that wealthy people could claim for their charitable deductions would ultimately help nonprofits, even as opponents say the proposal would essentially amount to a “tax on soup kitchens.”
President Obama made the proposal as part of his job-creation plan, saying he would pay for the legislation by reducing the value of all itemized deductions, including housing and charitable gifts.
But the White House has faced strong criticism from nonprofits that say changes to the charitable deduction would punish charities that are providing crucial services to those in need.
Republican leaders have also criticized the plan. Last week, Rep. Eric Cantor, the Virginia Congressman who is House Majority Leader, published a blog post that characterized the jobs bill as a “tax on soup kitchens.” He said the limits on write-offs would harm…
September 15, 2011, 9:32 am
Nonprofits Fight Proposal to Curb Charity Tax Breaks
Nonprofits are gearing up to fight President Obama’s plan to pay for his jobs bill in part by limiting charitable deductions. Mr. Obama wants to limit the amount all wealthy people can write off for charitable gifts as well as housing, medical expenses, and other items.
Nonprofit leaders say that a curb on deductions will stifle giving and that charity write-offs make up only a small percentage of the money the federal treasury loses in deductions by the wealthy.
In 2009, 46.4 million taxpayers claimed the itemized deduction, with the deduction for charitable donations totaling an estimated $158-billion, according to the Internal Revenue Service. That total accounts for 13 percent of all of the itemized deductions claimed that year. By comparison, taxpayers claimed an estimated $442-billion in deductions for mortgage interest and $432 billion for state and local taxes and…
August 31, 2011, 5:05 pm
State Regulators Shine Spotlight on Social Media
As charities increasingly use social-networking sites like Facebook and Twitter to raise money, state regulators are looking for ways to make sure that con artists aren’t using these sites to prey on unsuspecting donors.
At this year’s annual meeting of the National Association of State Charity Officials, social media will be a hot topic.
While most of the conference, to be held in a Washington suburb, will be conducted behind closed doors, social media will be discussed in two sessions on October 3 in an all-day event open to the public.
During one session, Bob Carlson, assistant attorney general in Missouri and the president of the charity regulators’ group, will to discuss legal implications of charity efforts on social networks, along with Jeremy Sher, president of Grassroots Giving Group, a company that advises charities on social-network fund raising.
In addition,…
August 10, 2011, 11:31 am
IRS Faces New Questions About Gift-Tax Stance
The Internal Revenue Service says it won’t comment on a demand from one of its former officials to clarify its policy on gift taxes for donors to politically oriented advocacy groups.
On Monday, as The New York Times reported, Marcus S. Owens, a Washington tax lawyer and the former head of the IRS’s tax-exempt division, sent a letter asking the tax agency to say whether it will ever enforce a gift tax on such donations. Mr. Owens says he worries the tax agency is bowing to pressure from Republican lawmakers who objected to the gift-tax enforcement.
Mr. Owen’s letter came after the IRS announced in July it was changing course and dropping any plans to enforce the rule, at least until Congress took action to force it to charge the tax or until the tax agency could spend time studying the issue and explain its views to the public.
The tax agency’s pursuit of the gift tax was…
July 18, 2011, 3:57 pm
Nonprofits Pay for Big Ad to Influence Lawmakers
Independent Sector, the coalition of charities and foundations, took out a full-page paid advertisement today in the political newspaper Politico, urging government leaders to avoid cuts to programs that work with nonprofits and objecting to President Obama’s proposal to limit the value of the charitable deduction.
The ad was signed by 126 leaders at nonprofits, including the American Cancer Society, YMCA of the USA, the Craigslist Foundation, the League of American Orchestras, the Sierra Club, and the Young Nonprofit Professionals Network.
The move is an effort to catch the attention of the White House and Congressional leaders who are now in talks on a deficit-reduction deal that must be negotiated before an August 2 deadline to raise the federal debt ceiling.
Nonprofits worry that many key programs to help the needy will be cut as lawmakers attempt to hash out a deal. In …
July 11, 2011, 10:50 am
Fate of Charitable Deduction Still Unclear in Debt-Ceiling Talks
Fund raisers may have seen a sign of hope when Speaker of the House John Boehner issued a statement on Saturday that he would not pursue a debt-reduction agreement that includes tax increases.
Odds are that opposition to increasing taxes would include the president’s proposal to limit charitable deductions for wealthy Americans. Last week many nonprofit leaders were worried that such a measure could be included as part of the weekend negotiations over raising the federal debt ceiling.
A spokesman for Sen. Jon Kyl, Republican of Arizona, who is in the negotiations, said that Sen. Kyl does not believe that increasing taxes, “which also means doing away with the itemized deduction for charitable contributions,” should be a part of any debt package.
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July 18, 2011, 9:29 am
Share Your Ideas for Improving Nonprofit Tax Returns
By Lisa Chiu
Independent Sector, a coalition of charities and foundations, is asking for ideas about how the Internal Revenue Service can improve the informational tax return for nonprofits, known as the Form 990.
People can submit ideas online, comment on other ideas, and vote for the best suggestion in the IS 990 Feedback Forum until July 25. The group is encouraging nonprofit employees who work in a wide arrange of areas—including those who focus on operations, finances, and legal issues—to submit ideas. Independent Sector will then use the comments in its recommendations to Congress and the Internal Revenue Service.
In June, the tax agency announced it was seeking public comments on the redesigned Form 990, which the IRS overhauled in 2008. The deadline for IRS comments is August 1.