Traverse City Record-Eagle

Opinion

April 14, 2013

Forum: Taxes and charitable giving – yes, they are related

The President has now released his proposed budget putting a cap on charitable deductions — estimated to cost nonprofits nationwide $5.6 billion in giving. In filing their tax returns many Michiganders are learning Michigan Charitable Tax Credits are now history. On April 24 we celebrate “Giving and Volunteering” at the State Capitol — recognizing that more than 87 percent of Michiganders report they give.

Why is this important? It is about jobs. One in 10 Michiganders works for a nonprofit, and individual givers are the largest source of financial support. Political leaders have said Michiganders will continue to give. Yes, giving is an act of the heart, but how much we give is influenced by tax policies in Washington and Lansing.

For example, the 2012 loss of Michigan Charitable Tax Credits has resulted in a reduction in giving to community foundations and food banks. For 20 years we, as families or individuals, have given $400 or $200 to our local community foundation or food bank and received a 50 percent state tax credit. The Johnson Center at Grand Valley State University has surveyed community foundations, and the Michigan Food Bank Council has surveyed their members.

Responding community foundations reported a 51 percent reduction in $400 gifts — a loss of more than $1 million. Kareemah El-Amin, Executive Director of the Food Bank Council of Michigan, says her members reported a drop of 47 percent in $400 gifts.

These examples are not good news when considering that 60 percent of Americans responding to a United Way Worldwide survey reported they will need to decrease their giving 25 percent or more if the tax deduction is limited.

The President’s budget has arrived at the same time as a push for tax reform is under way, led by the House Ways and Means Committee Chairman Dave Camp and Ranking Minority Member Sander Levin — two great Michiganders who understand the value of a strong nonprofit sector. However, because of recent federal budget cuts, the pressure on nonprofits to do more is intense. Yet, many nonprofits will need to reduce their hours, reduce their staff, and reduce the opportunity to mobilize thousands of Michiganders who volunteer.

Text Only

Opinion Poll
AP Video
Ariz. Inmate Dies 2 Hours After Execution Began Crash Kills Teen Pilot Seeking World Record LeBron James Sends Apology Treat to Neighbors Raw: Funeral for Man Who Died in NYPD Custody Migrants Back in Honduras After US Deports Israeli American Reservist Torn Over Return Raw: ISS Cargo Ship Launches in Kazakhstan Six Indicted in StubHub Hacking Scheme Former NTSB Official: FAA Ban 'prudent' EPA Gets Hip With Kardashian Tweet Bodies of MH17 Victims Arrive in the Netherlands Biden Decries Voting Restrictions in NAACP Talk Broncos Owner Steps Down Due to Alzheimer's US, UN Push Shuttle Diplomacy in Mideast Trump: DC Hotel Will Be Among World's Best Plane Crashes in Taiwan, Dozens Feared Dead Republicans Hold a Hearing on IRS Lost Emails Raw: Mourners Gather As MH17 Bodies Transported Robot Parking Valet Creates Stress-free Travel Raw: Fight Breaks Out in Ukraine Parliament