The Charitable Giving Coalition sent the following letter to Representatives Blake Moore (R-UT), Danny Davis (D-IL), Michelle Steel (R-CA) and Chris Pappas (D-NH) in support of the Charitable Act. You can find a PDF of the letter here.
On behalf of the Charitable Giving Coalition (CGC), a diverse group representing thousands of charitable and faith-based organizations across the country, we write to share our strong support for the Charitable Act, legislation that would restore and expand the charitable deduction for non-itemizing taxpayers, also known as the universal charitable deduction. We are grateful for your leadership and support.
In 2021, Americans gave almost $485 billion to charity, according to Giving USA. However, 2021 giving did not keep pace with inflation. In fact, when adjusted for inflation, 2021 giving fell by .7 percent compared to 2020. Recent data from the Fundraising Effectiveness Project (FEP) showed a further decline of 1.7 percent in 2022 compared to 2021, as well as a 10 percent decline in donors over the same time. Furthermore, according to a September 2022 poll conducted by Independent Sector, nearly half (49 percent) of respondents who are very concerned about inflation said they planned to give less to charity in 2022 than they did in 2021.
The charitable deduction is good tax policy. It encourages individuals to give away more money to charity than they otherwise would. Unfortunately, the current charitable deduction is only available to those who itemize, roughly 12 percent of taxpayers. A temporary universal charitable deduction enacted in 2020 expired at the end of 2021, creating uncertainty for Americans and the charities that rely on their donations to serve their communities.
The need for more charitable giving is not going away. From natural disasters to social problems to economic hardship, America is facing unprecedented challenges that nonprofit services can help to address. Congress can help the sector serve communities by restoring and expanding the universal charitable deduction, which encourages all Americans, regardless of income, to give to charity.
The bipartisan Charitable Act would be a step in that direction. If enacted, the bill would restore the non-itemizer charitable deduction and increase the amount taxpayers can deduct to approximately $4,600 for individuals and $9,200 for joint filers. The legislation would also make gifts to donor-advised funds eligible for the universal charitable deduction.
We are proud to support the Charitable Act and look forward to working with you and your colleagues in the Senate to urge Congress to enact this important legislation as soon as possible.
Thank you for your leadership and commitment to America’s charitable community.
Sincerely,
Charitable Giving Coalition