A bipartisan duo of senators want Treasury Secretary Steven Mnuchin to report on whether the tax overhaul signed by President Trump has hurt charitable giving.
James Lankford, R-Okla., and Chris Coons, D-Del., asked Mnuchin for data on how the law is affecting charitable giving so far and for quarterly reports in the future.
“We believe that even in times of tight budgets, we have a moral obligation to support our neighbors most in need, and charities play an essential role in doing just that,” the senators wrote in a joint letter.
The tax law makes several big changes that could crimp charitable giving by diminishing the tax rewards for donations.
One is the doubling of the standard deduction. More people will take the standard deduction rather than itemizing specific deductions such as donations, meaning they won’t get additional breaks for giving away funds.
Another is the lower income tax rates. Lower tax rates mean less incentive for people who do itemize.
The third is the larger exemption for the estate tax, which will mean that fewer people will engage in planned giving in order to avoid the hit of the estate tax.
Big nonprofits, universities, and other charitable organizations lobbied to get an expanded charitable giving deduction included in the tax bill, but came up short.
So far, the Treasury has limited data on the results of the new tax law. Only in the past week, for example, have the first results come in on corporate taxation.
