December 15, 2012

Obama vs Charitable Deductions?

From One News Now:

Obama working to reduce deductions for charitable giving

According to a story in The Washington Post, the president sees the move as part of his plan to reduce the federal deficit..

If Obama has his way, the government would limit the charitable deduction for high-income earners, the people that groups such as the Red Cross and the United Way depend upon for donations.

According to the Post story, non-profit group leaders say lowering or eliminating the deduction would reduce giving by wealthy donors. Studies have shown that people would donate less if the deduction were reduced, but estimates of the effect vary widely.

The newspaper report also notes that in recent meetings and phone calls, White House aides have been pressing nonprofits to get behind the president on this issue as he tries to reduce the federal deficit and avert the “fiscal cliff” facing the nation.

American Family Radio’s financial expert Dan Celia, however, suspects there is more to the president’s plan than meets the eye.

“When we hear the president or any other administrative person talk about this — saying Well, for families making $250,000, if you’re in a 35-percent tax bracket, you’re going from a 35-percent credit to a 28-percent credit for your charitable deductions — that’s going to be the headline you’re hearing,” he said.

But Celia contends that the 28-percent number being reported is actually a cap — one that includes mortgage deductions.

“And frankly, it includes all itemized deductions, including the mortgage interest deductions, other interest deductions and such, along with the charitable deductions,” he said Friday morning on American Family Radio. “So it’s not reducing just the charitable deduction — but that’s the argument they’re going to make.”

Now, why does that NOT come as a surprise? Perhaps the next step will be to nationalize the charities that contribute the most to liberals’ campaigns and, through the over-bureaucratization that is a hallmark of left-hand government, manage to make these charities exponentially more expensive to the taxpayer than they are while supported by deductible contributions.

by @ 10:45 am. Filed under The President
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