From: Laurie Baskin - Theatre Communications Group <firstname.lastname@example.org>
Date: Mon, Nov 6, 2017 at 3:08 PM
Subject: House GOP Releases Tax Bill - Theatres and All Nonprofits Threatened
Take action to support incentives for charitable giving!
House GOP Releases Tax Bill - Theatres and All Nonprofits Threatened
Today the House Ways and Means Committee began consideration of H.R. 1, The Tax Cuts and Jobs Act, released on Thursday, November 2 by the Committee Chairman Kevin Brady (R-TX). The tax proposal represents the most substantial change to the U.S. tax code since 1986 and includes provisions that would impact charitable giving and nonprofit operations.
Please click "Take Action Now!" and take two minutes to help us urge Congress to protect charitable giving incentives. GOP leaders plan to move a tax package quickly through Congress.
The introduction of the bill is the first step toward passage of a tax reform package which Congress hopes to complete by the end of 2017. Changes will be considered this week in the Committee and could go to the entire House for a vote the week of November 13. That same week the Senate is expected to release its version of a tax reform bill. During December the House and Senate will negotiate on a final tax bill, which they hope the President will sign by the end of the year.
Important effects the bill would have on the nonprofit sector:
- Charitable Deduction--Dramatic reduction in the number of people incentivized to give to charities and nonprofits: The bill nominally retains the existing itemized deduction for charitable donations, but by doubling the standard deduction, it puts an important incentive to give out of reach for 95 percent of American taxpayers. This decrease in the number of people who itemize would result in a decrease in charitable giving by up to $13 billion annually, according to a study from the Lilly School of Philanthropy. The measure fails to include a universal deduction sought by a broad coalition of nonprofits and foundations that would enable all Americans to receive a tax incentive for giving back to their communities. TCG joined in a statement by the Charitable Giving Coalition calling for leaders in Congress and the White House to write tax policies that will promote charitable giving by today's donors and cultivate a tradition of giving in future generations.
- Itemizers: For those still itemizing their returns, the bill would increase the limit on charitable deductions for cash gifts from the current level of 50% of adjusted gross income to 60%, potentially incentivizing more giving by those who had reached the 50% cap. The bill also would repeal the "Pease limitation," which currently reduces total itemized deductions for high-income tax payers.
- Estate Tax phased out: The estate tax would be phased out over six years under the proposal, prompting concerns about the potential impact on incentives for charitable giving.
- Unrelated Business Income Tax (UBIT): There is some good news as the House bill does not include previously-considered proposals that would have substantially altered UBIT calculations and subjected corporate sponsorships to new UBIT requirements. The bill includes a provision to tax certain fringe benefits offered to nonprofit employees, such as parking, transportation, or onsite gyms.
- Musical works not treated as capital property: The bill eliminates a provision in current law that allows taxpayers to treat the sale or exchange of a musical composition or a copyright for their own musical work as a capital gain or loss.
- Nonprofit non-partisanship threatened: The legislation would significantly weaken the long-standing Johnson Amendment, which prevents 501(c)(3) organizations from endorsing or opposing candidates for public office or diverting charitable assets to fund partisan campaigns, by granting a partial exemption to houses of worship and their auxiliary organizations.
TCG is partnering with our colleagues in the broader nonprofit community to continue to analyze the full text of H.R. 1. (See this helpful big-picture summary from the National Council of Nonprofits.)
The time has come to raise our voices, and we all need to step up--Member Theatres and Individual Members alike! We would like one message from all individuals and at least 10 messages from every TCG Member Theatre to be sent at every step in this process. Thousands of communications need to be generated to make a difference.
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