6/19/13 — One Tax Reform Item that Will Hurt Human Services, Communities

Coalition Working to Protect Charitable Deduction, Show Congress What’s at Stake

WASHINGTON, D.C. – The charitable tax deduction is vital to millions of disadvantaged people and thriving communities throughout America, the Charitable Giving Coalition said today. As federal lawmakers ramp up the debate on tax reform, the Coalition, a group of more than 60 nonprofits, foundations and other charitable organizations, continues to make a strong case about the importance of protecting the 100-year old tax incentive.

The Coalition responded to a document released by the Senate Finance Committee that includes tax reform considerations regarding the charitable deduction as committee members work to reform America’s tax system.

“We are encouraged that members of Congress understand the unique role and value of charitable giving in our communities,” the coalition said in a letter to Sen. Max Baucus (D-Mont.), chair of the Senate Finance Committee and Sen. Orrin Hatch, (R-Utah), the committee’s ranking member.“We are committed to working with you to ensure there is a clear understanding of the impact that various options or proposals to modify the charitable deduction will have in our communities.”

Reducing the Charitable Deduction Hurts Services, Donations
Coalition members are sharing with lawmakers data and examples to illustrate how the  charitable sector  improves lives in communities every day, as well as how individuals and communities will suffer if the charitable deduction is reduced or eliminated. For example, according to a recent report issued by Giving USA, “Itemized giving comprised 81 percent of the total estimate for giving by individuals in 2012.” Other research also shows that billions in donations could be lost each year and vital services cut or eliminated if lawmakers reduce the value of the deduction.

The Coalition is urging elected officials to consider the millions who depend on a network of highly effective, compassionate organizations across the country that provide jobs, economic development, food, shelter and more.

Association of Gospel Rescue Missions (AGRM)

Services

–    North America’s oldest and largest network of independent, faith-based crisis shelters and rehabilitation centers works with those who have been ravaged by abuse, imprisoned by addiction, or set adrift because of mental illness.

–    These organizations would be forced to cut back or eliminate services that feed, shelter, rehabilitate, counsel and train if incentives to give are stripped away.  Every year, AGRM-member missions:

  • Provide approximately 50 million meals.
  • Make available 25 million nights of lodging.
  • Distribute more than 30 million articles of clothing.
  • Graduate some 20,000 people from addiction recovery programs.

Donations

–    According to the AGRM, 100 percent of rescue missions rely on private donations, which make up at least 90 percent of all annual revenue.

Catholic Charities USA

Services

–    Last year, more than 2,700 Catholic Charities agencies and affiliates across the country provided help for more than 10 million people.

–    Catholic Charities agencies nationwide employ nearly 66,000 people and engage more than 311,000 volunteers on an annual basis.

Donations

–    Nearly $237 million (35 percent) of the more than the $679 million reported raised across the CCUSA network in 2011 came from individual donors.

–    Some local agencies report that up to 55 percent of their funding is provided through individual contributions.

The Salvation Army

Services

Nearly 30 million Americans in 5,000 communities receive assistance from The Salvation Army and its 70,000 officers and employees and 3.3 million volunteers.

Donations

–    The Salvation Army relies heavily on the generosity of Americans to serve people in need through food, disaster relief, assistance for the disabled and support for disadvantaged children, the elderly and the homeless.

–    In 2011, The Salvation Army received more than $2.8 billion in donations in the United States. More than $1.6 billion, or 57 percent, of that total came from individual donors.

–    Locally, some Salvation Army units receive more than 75 percent of their funding from individual donors and simply could not operate critical programs to meet the basic human needs without donor support.  

United Way

Services

–    Throughout America, some 1,200 United Ways employ more than 9,300 people and help mobilize 2.87 million volunteers each year, providing critical services for up to 52 million people in need.

–    Conservative estimates indicate that limiting the charitable tax deduction could reduce giving by a minimum of 2.5 percent for United Way. That translates to $104 million. The result – 1.3 million fewer times that United Way could provide job training for an unemployed worker, home care for an elderly citizen, supportive housing for a single mother or a mentor/tutor for an at-risk youth.

Donations

–    United Way Worldwide raises more than $3.9 billion annually, 95 percent of which is through private donations.

–    Seventy-two percent of funds raised – more than $2.8 billion – comes from individual donors. Of that, more than twothirds (68 percent) comes from those earning less than $100,000 per year.

America’s Art Museums

Services

–    Museums throughout America entertain, educate and enrich more than 52 million people each year, including partnerships between 200 museums affiliated with the Association of Art Museum Directors (AAMD) and more than 40,000 schools.

–    More than three-quarters of AAMD members offer free admission to active duty military and their families at least from Memorial Day to Labor Day as part of the Blue Star Museums program. Nationwide, more than 2,000 art, children’s, history, science and other museums are participating. Last year alone, the program reached more than 475,000 military personnel and their family members – and the effort continues to grow.  

Donations

–    Art museums are also regional economic engines, providing jobs, wages and services that generate significant economic activity. According to the AAMD, operating expenses of nearly 200 member organizations throughout America totaled nearly $2.4 billion in 2012. More than one-third ($840 million) of these art museums’ operating expenses are covered by tax-deductible gifts. That’s more than the combined operating expenses of 70 AAMD member museums in the following states:

  • California, Florida, Georgia, Illinois, Ohio, Pennsylvania, Texas

###

The Charitable Giving Coalition 
Representing private and community foundations, their grantees and independent charities, the Charitable Giving Coalition’s members include United Way Worldwide, the Salvation Army, Catholic Charities USA, the American Institute for Cancer Research, the Association of Fundraising Professionals, Independent Sector, the Council on Foundations, The Philanthropy Roundtable, among others. Formed in 2009, the coalition is a broad cross-section of nonprofit organizations across the country, including both the nonprofit organizations themselves and the associations and umbrella groups that serve their needs. The coalition is dedicated to preserving the charitable giving incentive that ensures that our nation’s charities receive the funds necessary to fulfill their essential philanthropic missions. The coalition provides a unique and unified voice on Capitol Hill on issues affecting the charitable deduction, a voice composed of both direct lobbying and robust grassroots advocacy.