Charitable Deduction and Tax Reform

Action Alerts:

December 2018: TCG Update: IRS Guidance on UBIT
On December 10, the Internal Revenue Service issued interim guidance (2018 - 99) aimed at addressing how nonprofits should value their liability for the new 21% Unrelated Business Income Tax (UBIT) on employee parking benefits in 2018. The guidance is temporary, will be followed by formal regulations, and does not address outstanding questions related to how the tax also applies to employee commuting benefits. A separate IRS notification (2018 - 100) offers to waive underpayment penalties for nonprofits that have not previously been required to report UBIT on Form 990-T and did not make estimated payments in 2018.
The nonprofit community continues to press for full repeal of the new tax on nonprofits, and theatres are taking action by urging elected officials to vote to repeal the new tax. TCG will keep you posted as IRS guidance is analyzed and summarized for use by nonprofits.

December 2017: Advocacy Update: Tax Reform Bill Passes - The Impact on Not-for-Profits
On December 19, 2017, the House voted on a final comprehensive tax reform package that will have immediate implications for the entire nonprofit community; the Senate voted the following day, and the bill became public law following the President's signature on December 22, 2017. Among the highlights of the final tax package are: the doubling of the standard deduction, no charitable deduction available for non-itemizers, loosened limitations on charitable deductions for those who will still itemize, the doubling of estate tax exemptions, and the protection of non-partisanship principles for 501(c)(3) organizations.
ACTION: Let Congress continue to hear about your disappointment in this new legislation and how tax reform will impact your work and your ability to serve your community. We also encourage you to think about how you can track the impact of these tax reforms and to keep us informed of any findings.

December 2017: Action Alert: Support Universal Deduction for Charitable Giving
In early December, the Senate voted to begin negotiating with the House on a comprehensive tax reform package, to take effect in 2018, that is predicted to decrease charitable giving for years to come. Neither of the tax bills the House and Senate approved in recent weeks included the universal charitable deduction sought by nonprofit organizations across the country. Theatres nationwide have been vocal advocates in support of charitable giving incentives, and the universal deduction offers a solution by providing all taxpayers an incentive to give as the standard deduction is increased. Please continue to express your support for a universal deduction for charitable giving!
ACTION:Please take two minutes to urge Congress to support a universal deduction for charitable giving!

November 2017: Action Alert: Tax Reform Comes Up for Votes This Week!
On Thursday, November 9, the Senate released its version of tax reform legislation, the Tax Cuts and Jobs Act. Like the similarly titled bill released by the House of Representatives two weeks ago, the Senate reform bill retains the charitable deduction but also doubles the standard deduction. As we have reported, doubling the standard deduction means that 95% of taxpayers would not itemize, leading to an estimated reduction in giving of $13 billion annually.
ACTION: Please take two minutes to help us urge Congress to provide giving incentives for growing ranks of non-itemizers by supporting a universal charitable deduction.

November 2017: Action Alert: House GOP Releases Tax Bill: Theatres and All Nonprofits Threatened
On Monday, November 6, the House Ways and Means Committee began consideration of H.R. 1, The Tax Cuts and Jobs Act, released on Thursday, November 2 by the Committee Chairman Kevin Brady (R-TX). The tax proposal represents the most substantial change to the U.S. tax code since 1986 and includes provisions that would impact charitable giving and nonprofit operations. TCG is partnering with our colleagues in the broader nonprofit community to continue to analyze the full text of H.R. 1. (See this helpful big-picture summary from the National Council of Nonprofits.)
ACTION: Please take two minutes to help us urge Congress to protect charitable giving incentives. GOP leaders plan to move a tax package quickly through Congress.

October 2017: Action Alert: New Tax Reform Framework Could Harm Charitable Giving
A new Congressional framework for comprehensive tax reform was released last week, and it could have a negative impact on charitable giving. TCG is representing theatres and is partnering with the broader nonprofit community to urge Congress to protect and grow incentives for charitable giving. TCG joined in a statement by the Charitable Giving Coalition calling for leaders in Congress and the White House to write tax policies that will promote charitable giving by today’s donors and cultivate a tradition of giving in future generations.
ACTION: Please take two minutes to help us urge Congress to expand charitable giving incentives to all American taxpayers.

May 2017: Action Alert: The President’s Expanded Budget Includes Closing Down the NEA
As promised in the President’s “skinny budget” released in March, the Administration’s detailed budget proposal released on May 23 begins the process of shutting down the National Endowment for the Arts. To that end, the Administration’s FY18 budget would reduce funding for the agency from the current $150 million to $29 million. In order to preserve and protect the NEA, your elected officials need to hear from you. They need to know that you, their constituents, support a federal role for the arts and that you oppose the President’s proposed elimination of the NEA.
ACTION: Take action now by contacting your elected officials to urge their support for the NEA!

May 2017: Action Alert: The Administration’s Tax Reform Proposal and Charitable Giving
At the end of April, the White House released its tax reform proposal. While tax deductions for charitable giving were maintained, the proposal would double the standard deduction, thus reducing the percentage of people who itemize on their tax return from 30% to 5%. Since the charitable deduction is currently available only to itemizers, this proposal would vastly reduce the number of taxpayers who are incentivized to give by being eligible to claim the charitable deduction. It is estimated that 28 million people will lose their tax incentive to give to charities, resulting in $34 billion less in giving each year.
ACTION: Help protect incentives for charitable giving! Please take two minutes to let your Members of Congress know how your theatre’s service to its community could be affected if charitable giving declines.

December 2015: Weigh In On the IRS’ New Gift Substantiation Proposal
The Internal Revenue Service (IRS) is proposing new regulations that would establish a voluntary process for nonprofits to substantiate gifts of $250 or more from individual donors. Under this new process, nonprofits could file a voluntary alternative information return that would require collecting donors’ Social Security numbers (SSN) or taxpayer identification numbers (TIN) to substantiate gifts. This form would have to be filed in addition to the organization’s 990 and sent to the donor by February 28 of each year for donations received in the previous tax year. Currently, the IRS requires nonprofits to substantiate gifts of $250 or more by providing donors with written documentation, typically an acknowledgement letter stating the amount of the gift or value of any non-cash item that is donated. Many arts organizations already have a sufficient practice in place to send donors acknowledgement letters for contributions and feel that this additional proposed process–though voluntary–would be unnecessary and cause additional administrative burdens.
ACTION: Submit your comments to the IRS about how this proposal would affect your organization.

November 2015: Ask Congress to #Act4Good!
The IRA Charitable Rollover expired at the end of 2014 and has been unavailable this year to donors as an option to support the nonprofits serving their communities. There has been support for this provision in Congress this year: in February, the House passed the “America Gives More Act” to permanently reinstate a set of charitable giving incentives that included the IRA Rollover. The Senate Finance Committee passed a similar bill in July. With only six weeks left until the New Year, we need Congress to #Act4Good and reinstate and make permanent this important tax provision!
ACTION: Write your lawmakers and urge them to support the IRA Charitable Rollover!

7/21/15: Tell Your Senator to Extend the IRA Charitable Rollover (Targeted to Senate Committee)
Your Senator, who sits on the Senate Committee on Finance, will be considering a bill tomorrow that would extend the IRA Charitable Rollover along with other expired tax provisions. The IRA rollover expired on December 31, 2014, and nonprofit advocates across the country have been asking the Senate to reinstate and make this permanent. The Senate bill that will be marked up tomorrow would reinstate these provisions for two years, retroactively from January 1, 2015 through December 31, 2016. Nonprofit performing arts organizations are able to serve their communities with educational programming, partnerships, and high quality arts experiences with support from IRA Charitable Rollover donations. The longer Congress waits to take action, the fewer resources will be available to support community needs.
ACTION: Please take action and contact your Senator on the Finance Committee today! Send a letter to your Senator about the Rollover, and include a personalized message about the importance of this support for your organization's work.

2/11/15: Make the IRA Charitable Rollover
This week, the U.S. House of Representatives will consider making permanent a package of charitable giving incentives that includes the IRA Charitable Rollover. After expiring at the end of 2013, the IRA Rollover was reinstated by Congress and the White House in the final weeks of 2014. However, as of January 1, 2015, it has expired again. This cycle of expiration and renewal creates uncertainty for organizations that cultivate planned gifts to support their arts organizations. Before the vote, tell your Representative how important the IRA Charitable Rollover is to supporting your arts organization’s work.
ACTION: Write a letter to congress and include your stories of the education programs, community engagement initiatives, and enriching, high-quality performances that have impacted your community.

12/8/14: Make the IRA Rollover Permanent!
Possibly as early as tomorrow, the House is expected to vote on a new stand-alone bill that would make the IRA Rollover a permanent tax incentive. This is a separate bill from last week’s measure passed by the House, which seeks to extend a broader set of tax provisions only through the remainder of 2014. The IRA Rollover allows individuals 70 ½ and older to make tax-free contributions to charities, directly from their IRA account. Donors may contribute up to $100,000. Nonprofit arts organizations have received crucial support for their work through IRA contributions.
ACTION: Take action now and urge your lawmaker to make the IRA rollover permanent!

8/14/14: Encourage the Senate to Support the IRA Charitable Rollover
In July, the House of Representatives passed the America Gives More Act (H.R. 4719) which includes a provision to reinstate and make permanent the IRA charitable rollover. The Senate must consider this bill next, and we’re calling on you to take action and urge your senators to move this legislation forward. The rollover expired at the end of 2013, and if the Senate does not pass this bill before the November elections, it is unlikely that they will do so before the end of 2014.
ACTION: Contact your senators to move this legislation forward.

7/15/14: Upcoming House Vote to Reinstate IRA Rollover
On July 17th the full House of Representatives is set to vote on legislation to permanently reinstate the IRA charitable rollover. This important provision expired at the end of 2013, greatly reducing the incentive for individuals to support nonprofit arts organizations. The vote will be on H.R. 4719, and the IRA rollover is one of five charitable provisions important to the non-profit sector being considered along with this bill.
ACTION: Tell your representative to reinstate the IRA charitable rollover!

5/23/14: EXPIRE Act Stalled in Senate
The EXPIRE Act—which proposed to reinstate the IRA Rollover among many other expired tax provisions—stalled in the full Senate on May 15 when it did not receive enough votes to overcome a filibuster. Meanwhile, in the House, Reps. Aaron Schock (R-IL 18th) and Earl Blumenauer (D-OR 3rd) introduced H.R. 4619 on May 8 which would make this tax provision permanent. PAA continues to advocate for the reinstatement and permanent status of the IRA Rollover by signing on to an open letter to the House Ways and Means Committee from Independent Sector asking them to renew and make permanent the provision and asking committee members to co-sponsor H.R. 4619.
ACTION: Tell your members of Congress how important it is that individual donors be able to support your organization’s work. Take action to reinstate the IRA Rollover on the PAA website.

1/17/14: Reinstate the IRA Rollover and Support the Public Good IRA Rollover Act of 2013
The IRA Charitable Rollover expired at the end of 2013 but this important giving incentive has allowed for millions of dollars of contributions to support the work of nonprofit organizations. It is critical to maintain charitable giving options in order to provide a consistent source of revenue for programs and services to people and communities. Senator Charles Schumer (D-NY) introduced the Public Good IRA Rollover Act of 2013 (s. 1772) which would expand and extend this tax incentive, making the provision permanent.
ACTION: Contact your representatives today to request their support of extension of the IRA Charitable Rollover provision and the Public Good IRA Rollover Act of 2013.

Archived Charitable Giving and Tax Action Alerts here

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