Source: Independent Sector
We now have more proof that the House tax reform bill would hurt charities and the communities we serve. The Joint Committee on Taxation (JCT) released analysis yesterday finding that House tax reform bill would mean 31 million taxpayers would no longer be incentivized to give through the charitable deduction in 2018. Bottom line: charitable giving will decrease by billions of dollars.
The Tax Cuts and Jobs Act (H.R. 1) currently being debated by the House Ways and Means Committee would retain the charitable deduction, but only for a small percentage of taxpayers who continue to itemize due to other recommended policy changes. That means about 95 percent of taxpayers would not have access to the charitable deduction, which we have seen in countless studies does incentivize people to give more of their money to charity. The sharp decline in those taking advantage of the deduction is confirmed in the JCT report, leaving this powerful incentive as merely a tool for those wealthy few who can still afford to itemize. A study by Indiana University commissioned by Independent Sector earlier this year, suggests that charitable giving would be reduced by $13 billion a year.