As has been widely reported, President-Elect Donald Trump’s plan to change the U.S. tax system includes placing a cap on itemized deductions–$100,000 for a single person, and $200,000 for a married couple.
Sound like plenty to cover your deductions? (It sure is for mine.)
But we all have cause for concern about the impact on U.S. nonprofit organizations, because charitable donations are on the list of potential U.S. tax deductions.
Suddenly, the wealthiest of donors will have less incentive to give. And there’s no question that tax deductions form a part, though not all, of donors’ motivations to give (witness the end-of-year donation rush).
This is especially troubling news when issued around the same time as a report from the Institute for Policy Studies, finding that recent growth in philanthropic giving is concentrated among a handful of high-income, high-wealth donors, while giving by lower- and middle-income donors is steadily declining–mirroring the increasing concentration of societal wealth.
If I were in charge of a nonprofit right now, I’d work extra hard on that end-of-year 2016 campaign to my wealthiest donors!