Perry Fleischer Presents Why Limit Charity? Today at UCLA

Miranda Perry Fleischer (Colorado) presents Why Limit Charity? at UCLA today as part of its Tax Policy and Public Finance Workshop Series, Here is the abstract:

In the wake of Hurricane Katrina, Congress temporarily lifted one of the most puzzling limits in the tax Code: the cap that prevents an individual from claiming a charitable deduction greater than 50% of her income, even if she gives more than half her income to charity. Although scholars often criticize the cap in passing for creating unnecessary complexity, few have explored its theoretical underpinnings, and those who have appear hard-pressed to find a satisfactory justification.

This Article fills that void by proposing a more satisfactory explanation for the AGI limits grounded squarely in the literature conceptualizing the charitable deduction as a way of overcoming market and government failure for various public goods by spurring non-profits to produce them. It argues that the AGI limits reflect a compromise among voters that reconciles the delivery of public goods through the private charitable sector with certain principles of democratic governance.