Included in this Round-Up
- Universal Charitable Deduction
- More from Hill Day
- Postal: Brace for Big Postage Increase
- From the States
Universal Charitable Deduction Extension…Much Accomplished, But Much To Do!
Momentum for extending the Universal Charitable deduction continues to increase, but there are still important hurdles to cross before it can be enacted into law for tax year 2022.
First, the good news
S. 618, the Senate Universal Charitable Deduction bill led by Senators James Lankford (R-OK) and Chris Coons (D-DE) now has 16 Senators (8 Republicans and 8 Democrats) who have signed onto the legislation. Importantly, of those 16 cosponsors, six of them serve on the committee of jurisdiction, the Senate Finance Committee.
Now the challenge
While the list of cosponsors of the legislation demonstrates broad bipartisan support, the challenge remains to break inertia and get the legislation enacted into law as soon as possible. And here is where our challenge is particularly tricky. The Universal Charitable Deduction of $300 for individuals and $600 for married couples filing jointly expired on December 31, 2021, along with a number of other tax provisions, largely impacting corporate entities.
These other expiring tax provisions do not face the timing issue that the Universal Deduction faces. The corporate expiring tax provisions can be extended for tax year 2022 as late as April of 2023, when most companies will file their 2022 tax returns. And if Congress follows its customary practice of making their enactment retroactive to January 1 of 2022, they will enjoy the full benefit of the extension.
The nonprofit community does not have the luxury of time because until the extension for tax year 2022 is enacted by Congress, charities cannot advise their donors of the existence of the Universal Deduction. Accordingly, our biggest concern continues to be that the Universal Charitable extension will be tied in with the other expiring tax provisions as a so-called “package of expiring provisions,” and Congress will not act on this package until later this year, missing the opportunity to incentivize charitable giving.
What is TNPA doing to move the Universal Charitable Issue? We had an important Hill Day. On March 2, TNPA held a Virtual Capitol Hill Day with nonprofit executives and commercial partners participating in a day of meetings with key players on Capitol Hill to focus on the need to move forward on the Universal Charitable Deduction…as soon as possible!
Our centerpiece meeting of the Hill Day was with one of our champions on the Universal Charitable issue, Senator Chris Coons (D-DE). After a very productive meeting, Senator Coons pledged to personally contact Senator Maggie Hassan (D-NH and a member of the all-important Senate Finance Committee) on the Universal Charitable issue. And just six days after meeting with Senator Coons, Senator Hassan signed on to the bill.
Two weeks later, on March 17, the Senate Finance Committee held a hearing on “Examining Charitable Giving Trends in the Nonprofit Sector.” One of the champions of the Universal Charitable Deduction issue, Senator Lankford, serves on the Finance Committee and at the hearing the Senator made a number of statements on the importance of extending this deduction as soon as possible. TNPA will continue to work full speed on building momentum for enactment of the Universal Charitable Deduction for tax year 2022 as soon as possible.
More Hill Day Updates
TNPA participants had meetings with key congressional staff on the issue of postal reform, which was actually being debated on the Floor of the Senate during our virtual Hill Day.
Additionally, we had a meeting on the need for national privacy legislation with the staff of Senator Jerry Moran (R-KS), who has been a key player on the issue.
Hill Day attendees included:
- Alicia Lifrak – Gabriel Group
- Tycely Williams – Bipartisan Policy Center
- Gail Hamaty-Bird – Food for the Poor
- Christopher Jungers – Passionists of the Holy Cross Province
- Gary Weinberg – DM Pros
- Steve Colella – Calmark Group
- Steve Abrahamson – National Audubon Society
- John Bell – MMI Direct
- Brother Tobias – Benedictine Mission House
USPS and Postal Rates
In terms of postal reform, the legislation passed the Senate on March 8 and was sent to President Biden, who has said he will sign the legislation into law. As we have previously reported, the postal reform bill includes several positive provisions, including moving $50 billion of postal retiree healthcare costs over the next 10 years from the Postal Service to Medicare, where most retiree healthcare costs reside.
Unfortunately, the legislation does not have any language limiting future postal rate increases.
TNPA continues to believe a long-term solution to endlessly skyrocketing postal rates can only be found by way of structural reform of the USPS and its funding methods. In essence, the USPS cannot successfully be “run as a business” while incorporating substantial obligatory public service missions in its operations.
From the States
We continue to follow legislation in many states. For more details and additional state bills that could impact the work of the nonprofit sector, as well as links to the actual bills, visit our States Policy page.