Time and time again, the President continues to put forth proposals to limit charitable deductions for the wealthy. The latest proposal is attached to the President’s jobs bill. If it passes, a wealthy donor who contributes $100,000 to a charity (starting in 2013) would only be able to deduct $28,000 of it; $7,000 less than the current amount allowed.
Many charity leaders are opposed to this proposal as they predict it would cause wealthy philanthropists to limit their giving. It has been estimated that, with no deduction for charitable gifts, annual giving would drop by 25 to 36 %, and the proposed cap could cost charities as much as $7 billion a year in contributions. Not only would that force charities to cut back on their charitable programs/ services, but it would also mean job losses which is just the opposite of what the President is trying to accomplish with this bill.
Image Shutterstock/ Mariusz S. Jurgielewicz