United Way wary of tax changes for charitable giving

The cliff-avoiding tax bill Congress approved Tuesday carries limits on personal exemptions and itemized deductions for individuals who make more than $250,000 and couples who make more than $300,000, a fact that concerns groups that benefit from charitable giving. “It could affect [donors’] willingness to make contributions to nonprofit organizations,” says Capital Area United Way interim CEO Richard Williams. “We’ve been watching that fairly closely.” According to a survey by United Way Worldwide, which has been lobbying to preserve the charitable tax deduction, roughly three out of 10 Americans say they would give less to charity if the tax deduction was reduced or eliminated. As The Wall Street Journal reports, a coalition of nonprofit groups called the Alliance for Charitable Reform says lawmakers should consider excluding charitable-donation deductions from the new limits. The coalition also suggests lawmakers take steps to “continue to preserve the charitable deduction … as we move forward into both tax reform and measures to address the federal deficit.” Williams says it’s too soon to say if the new changes will reduce giving locally, which for CAUW has been relatively flat for the past few years. However, he says they’ve seen some positive signs during the current campaign, thanks in part to better times for the region’s petrochemical plants. —David Jacobs