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The Universal Charitable Giving Act

The Universal Charitable Giving Act
For more than 130 years, Baptist Children's Homes of North Carolina has been doing incredible work bringing hope and healing to children and families in North Carolina. Watch how important charitable donations are to their work, and how the Universal Charitable Giving Act will help incentivize more charitable donations and broaden the base of people who can give to the causes they believe in. 

 

 

What The Bill Does

Read the full two-page text of the Universal Charitable Giving Act here.
 
The Universal Charitable Giving Act establishes an universal charitable deduction for individuals and married couples who do not itemize, in addition to the standard deduction. This would be an above-the-line deduction up to one-third of the standard deduction – about $2,100 for individuals and $4,200 for married couples. 

Why It Matters

 
The GOP Tax Reform Framework recently released is a big win for the American people. A key aspect of the plan is to double the standard deduction so that lower and middle income families keep more of their paycheck and have more income that is not taxed. Under the current system around 70% of tax filers claim the standard deduction. Estimates have shown, under the new GOP Tax Reform Framework, that number would rise to 95% of tax filers taking the standard deduction rather than itemizing. 
 
Under current law, only taxpayers who itemize their deductions can deduct charitable donations to qualifying organizations. As a potential unintended consequence of the bold, pro-growth GOP Tax Reform Framework, the doubling of the standard deduction will lower the number of itemizers and likely decrease charitable giving incentives for many taxpayers.
 
The Universal Charitable Giving Act incentivizes charitable giving for low and middle income taxpayers. It would not only help individuals and families who would likely stop itemizing their deductions under the new tax plan, but would also encoruage taxpayers who already claim the standard deduction to give the charities and causes they believe in.
 
This bill is focused on helping charities, and the lower and middle class. In fiscal year 2017, roughly 71% of the tax expenditures for charitable giving will be claimed by taxpayers who earn $200,000 a year or more. By broadening the base of people who can deduct charitable donations, this bill aims to empower lower and middle income earners to direct funds willingly to socially productive organizations they wish to support.
 
Giving to charity is crucial for economic prosperity, happiness, and the success of our people. But for too long, only the upper class has been incentivized to give to charitable organizations. With the GOP Tax Reform Framework, our aim is to increase take home pay for middle America, and with the Universal Charitable Giving Act, our goal is to increase support for our charities. Congress should support the great work of our faith-based and charitable organizations by supporting this bill. 

What People Are Saying

The Ethics and Religious Liberty Commission

"A Universal Charitable Deduction would incentivize all taxpayers, not just those in upper income brackets who itemize their deductions. Our government should welcome the generosity of all citizens–at all levels of income–who desire to help their neighbors through religious associations, educational institutions, and any organization that relieves poverty. Current legislative proposals that would allow above-the-line deductions for individuals not itemizing include Senator James Lankford’s S.2123 and Congressman Mark Walker’s H.R. 3988. "

Alliance for Charitable Reform

"We thank Congressman Walker for listening to charities and introducing this bill. It addresses our concern that the current charitable deduction would be diminished by greatly reducing the number of Americans who itemize, which will curb giving. As a solution to this concern, the charitable sector has proposed expanding the charitable deduction to all Americans. We look forward to working with Congressman Walker, his staff and other members of Congress to build on this momentum to make this legislation as robust as possible,” said Sandra Swirski, executive director of the Alliance for Charitable Reform."

Charitable Giving Coalition

"The Charitable Giving Coalition (CGC) applauds Congressman Mark Walker (R-NC-6) for standing up for America’s charitable organizations and the communities they serve. Congressman Walker’s bill expands good tax policy, providing an incentive to more Americans to invest in their communities through charitable giving. A non-itemizer deduction will become even more critical within the larger tax reform framework."

Independent Sector

"We welcome the introduction of the Universal Charitable Giving Act of 2017 (H.R. 3988), which would expand the charitable deduction to individuals who do not itemize their taxes under current law. Independent Sector will be working with the research community and peer organizations across the sector to better understand the impact of Rep. Walker’s bill on the charitable community. We look forward to working with the Congressman, his staff, and other members of the tax writing committees in both the House and the Senate to ensure that every American is incentivized to give more to charities in order to improve their communities."

American Heart Association

"We wanted to take this opportunity to thank [Rep. Walker] for introducing the Universal Charitable Giving Act, which would allow non-itemizers to deduct their charitable giving. We appreciate [Walker's] leadership in exploring efforts to incentive low and middle-income taxpayers to continue to support nonprofits in their communities." 

Council Foundations

"This proposal places the discussion about a universal charitable deduction squarely in the midst of the ongoing tax reform negotiations, and that’s good news for foundations and the nonprofit sector. We thank Rep. Mark Walker of North Carolina for taking up this issue and moving it forward."

National Council of Nonprofits

“Representative Walker’s bill takes an important step toward possibly resolving significant problem that the framework creates; he is to be commended for taking swift and decisive action in support of our communities."

 

Universal Charitable Giving Act in the News

Non-profit says it supports new Universal Charitable Giving bill | WGHP Fox 8

By: Nick Studivant

“'We know that a lot of our donors don’t give for the tax implications, but that they give because they really care about their community, but we also know that for some donors, the ability to give is made possible by the fact that they are getting some credit on their taxes. That they don’t have a lot of extra disposable income. So, without the ability to have some credit toward their taxes it might be impossible,' Gordineer said.

"Walker’s bill is also a response to the new GOP tax plan. The bill is aiming to help individuals and families that would likely stop itemizing their deductions under the new plan by encouraging those who already claim the standard deduction to give to charities that they want to."
 

Charities could be big losers under tax reform. One NC rep is trying to fix that. | McClatchy DC

By: Brian Murphy

"Republicans in Congress want to double the standard deduction – the amount income taxpayers can claim even if they don’t itemize their tax deductions. The proposed change would simplify filing and reduce the need to itemize, so fewer people would be eligible to claim charitable deductions.

"That’s where Walker’s bill comes in. It would allow taxpayers to claim a charitable deduction of up to $2,100 for individuals and $4,200 for married couples even if they claim the standard deduction. That figure is about one-third of the current standard deduction."

 

Key conservative Republican eyes bigger tax break for charity | The Hill 

By: Naomi Jagoda

"The leader of the biggest group of House conservatives is quietly pushing to expand the number of people who can claim a tax break for charitable giving in the GOP tax-reform legislation, expected to be released within weeks.

"Rep. Mark Walker (R-N.C.), the chairman of the Republican Study Committee, introduced a bill late last week without fanfare to create a new deduction for charitable contributions for those who don’t itemize. His office predicts it will likely be merged within the tax bill that Republicans are counting on to deliver their first big legislative victory this year."

 

The GOP plan to simplify taxes could put charitable giving at risk | The Washington Post

By: Carolyn Y. Johnson

"At the heart of the GOP tax plan is a push toward simplification that could have unintended consequences, potentially hurting charities — particularly those that depend on donations from middle-class donors.

"To fulfill a long-held promise to make taxes simpler, the plan would end itemization for most Americans who use it today, by increasing the standard deduction. About 30 percent of taxpayers who file returns currently itemize — and the prospect of that change has triggered a strong behind-the-scenes campaign from charities seeking to make sure the tax incentive continues to be used."

"Instead of pitching a political fight against one of the core pieces of the GOP tax plan, charities are trying to push for a universal deduction for donations — one that anyone can take, regardless of whether they itemize. Rep. Mark Walker (R-N.C.) introduced a bill proposing that idea last week."

 

Mark Walker introduces charity tax deduction bill | The Washington Times

By: David Sherfinski

"Rep. Mark Walker, an influential House conservative, has come up with a plan to add a $4,000 tax deduction for charitable giving beyond what’s already in the code and to give a boost to low- and middle-income families by letting them take the standard deduction and also deduct for charitable giving."

 

Why Philanthropy Is Worth Defending in the Tax Code​ | Real Clear Politics

By: Karl Zinsmeister

"The chairman of the Republican Study Committee, Rep. Mark Walker, has proposed folding a bold countermeasure into the tax template now before Congress. It would allow all Americans to deduct their charitable contributions, not just the typically upper-income earners who itemize. House Ways and Means Committee Chairman Kevin Brady has expressed sympathy for similar ideas in the past."

 

A very unhappy 100th birthday for the charitable deduction | The Hill

By: Tim Delaney

"Instead, Congress needs to make it universally available to all Americans through a non-itemizer deduction for charitable contributions. There are several ways that such a deduction could be crafted, including one proposed in H.R. 3988, the Universal Charitable Giving Act of 2017, introduced recently by Rep. Mark Walker (R-N.C.)"