Washington, D.C., December 8, 2017 – As Congress hammers out a tax reform bill, nonprofits must prepare for possible impacts from several provisions under consideration, according to attorneys with Alliance for Justice’s Bolder Advocacy program. Bolder Advocacy has prepared a quick fact sheet highlighting some of the more salient proposals in draft tax bills, and stands ready to help guide nonprofits in navigating any new rules that may emerge.
“Much of the focus has been on the possible repeal of the Johnson Amendment and the impact on nonprofits,” said Abby Levine, Director of Bolder Advocacy. “It’s true that if there are changes in that area, there will be a seismic shift in the tax landscape for public charities. But that’s not the only possible effect this bill could have. At Bolder Advocacy, we are watching these developments closely and will be offering training and information to nonprofits, so they understand how to respond effectively.”
Bolder Advocacy notes that one of likeliest effects of tax reform would be a significant decrease in individual gifts to public charities that operate under the 501(c)(3) portion of the tax code. Currently, taxpayers who itemize their returns can claim a deduction for contributions to 501(c)(3)s. But both the House and Senate tax bills contain provisions to raise the standard deduction for taxpayers, which would disincentivize itemization in one’s tax returns. This could have the effect of undercutting financial support for 501(c)(3)s; meanwhile, it is not clear if there would be secondary effect of former 501(c)(3) donors shifting their support to 501(c)(4)s, given the loss of the tax advantage that formerly applied only to 501(c)(3) donors.
Nonprofits and foundations can access Bolder Advocacy’s expertise in several ways: via our website, by phone at BA’s free technical assistance hotline, 1-866-NP-LOBBY, and in our workshops. Bolder Advocacy is a leader in providing training and resources that empower nonprofits to be highly effective advocates for their missions, while remaining compliant with complex tax regulations governing nonprofits.