TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Saturday, March 4, 2017

Colinvaux:  The Importance Of A Participatory Charitable Giving Incentive

Roger Colinvaux (Catholic), The Importance of a Participatory Charitable Giving Incentive, 154 Tax Notes 605 (2017):

Leading tax reform proposals contemplate a charitable deduction claimed by just five percent of taxpayers. Such a limited deduction would fatally undermine the foundations of a giving incentive that has fostered an altruistic and pluralistic society through its broad-based participation and would seriously harm the charitable sector. Section 501(c)(3) would recede in importance as setting the standard for a public benefit organization. More gifts would go to private benefit and political organizations. The article argues that a charitable deduction for the few should be rejected.

Instead, Congress should consider expanding the charitable giving incentive by extending it to more taxpayers in the form of a credit. A credit would remove long-standing inequities, allow for smarter charitable giving policy in the future, and improve transparency. If a charitable deduction for the few does become part of tax reform, however, changes should be made to ensure that deductible contributions are not abused but go to active public charities.

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I would make charitable donations with or without a deduction. We would be better off without them. Then we can get rid of charities which seem to be job creation centers for some, and actually do limited charitable work for others. Before income tax and deductions were ever created the American people were charitable to those in need.

Posted by: Milwaukee | Mar 4, 2017 7:44:02 AM

Amen to Milwaukee. First, isn't there some concern regarding the separation of church and state? Namely the idea of tax dollars going to churches of all denominations, albeit indirectly, where the taxpayer gives money to a church (a reduced tax liability) rather than to the treasury. Imagine the outcry if the treasury skipped the tax calculations and simply wrote checks to churches and other charities.

Posted by: Ripper | Mar 5, 2017 6:59:46 AM