ABSTRACT

Tax Incentives for Charitable Giving in the Tax Cuts and Jobs Act (H.R. 1) [November 17, 2017]   [open pdf - 132KB]

"Provisions in the Tax Cuts and Jobs Act (H.R. 1) would decrease the tax incentive for charitable giving. Under current law, taxpayers itemizing deductions can deduct contributions made to charitable organizations. Generally, the deduction is limited to 50% of adjusted gross income (AGI), although there are lower AGI limits for certain types of non-cash gifts and for gifts to certain types of recipient organizations. H.R. 1 would decrease the tax incentive for charitable giving by substantially reducing the number of taxpayers itemizing deductions. Specifically, the standard deduction would be nearly doubled, causing fewer taxpayers to itemize. Additionally, most other itemized deductions would be repealed, pushing more taxpayers under the standard deduction threshold. Currently, about 29% of taxpayers itemize deductions. Under the proposal, an estimated 6% of taxpayers would itemize in 2018. Only taxpayers that itemize deductions have a tax incentive to give. Lower effective marginal tax rates under H.R. 1 would also tend to reduce the tax incentive to give."

Report Number:
CRS Insight, IN10820
Author:
Publisher:
Date:
2017-11-17
Copyright:
Public Domain
Retrieved From:
Federation of American Scientists: http://www.fas.org/sgp/crs/index.html
Format:
pdf
Media Type:
application/pdf
URL:
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