logo logo
Donate
    • Membership
    • Donate
  • Social Justice
    • Racial Justice
    • Climate Justice
    • Disability Justice
    • Economic Justice
    • Health Justice
    • Immigration
    • LGBTQ+
  • Civic News
  • Nonprofit Leadership
    • Board Governance
    • Equity-Centered Management
    • Finances
    • Fundraising
    • Human Resources
    • Organizational Culture
    • Philanthropy
    • Power Dynamics
    • Strategic Planning
    • Technology
  • CONTENT TYPES
  • Leading Edge Membership
  • Newsletters
  • Webinars

With Tax Bill, Nonprofits Need to Look Beyond Sector Needs

Martin Levine
November 8, 2017
Pixabay. Creative Commons 0. Public domain.

November 5, 2017; eJewish Philanthropy

It is true that the Trump administration’s new tax “reform” proposal has the potential to directly affect how nonprofits operate and raise funds, but it is also true that along with the recently approved budget resolution, the reform plan will drastically reshape the direction of the federal government, as well as the lives of many it serves. Depending on the lens nonprofit organizational leaders choose to evaluate the plan as it moves through the legislative process, the pros and cons of the bill will look very different.

On Monday, NPQ printed the position of the National Council of Nonprofits, which overall panned the package on the basis of what it might do to nonprofits of all sizes and shapes across the country. But the analysis from the Jewish Federations of North America (JFNA) looks very different, taken as it was from a closer vantage point. JFNA shared their view in a recent edition of eJewish Philanthropy:

Favorable provisions

  • Charitable contribution deduction: preserves the existing charitable contribution deduction as one of only three remaining itemized deductions
  • Increase in adjusted gross income limit on annual charitable deduction: boosts from 50 to 60 percent
  • Pease amendment repeal: eliminates limitation on itemized deductions
  • Private school tuition relief: expands Section 529 plans to cover elementary and secondary schools

Harmful provisions

  • Donor-advised funds increased record keeping: imposes annual distribution and inactive fund provisions
  • Private activity bond repeal: eliminates an important source for capital project financing
  • Disability access tax credit repeal: negatively impacts the disability community
  • Johnson Amendment weakening: undermines important protection for charities
  • Endowment excise tax: adds an anti-planned giving and anti-endowed giving provision

Is it at this level that nonprofits should focus their lens? Or is there a larger, more global perspective that these direct impacts should be weighed against?

Sign up for our free newsletters

Subscribe to NPQ's newsletters to have our top stories delivered directly to your inbox.

By signing up, you agree to our privacy policy and terms of use, and to receive messages from NPQ and our partners.

The National Council of Nonprofits thinks it critical that both the micro and macro perspective be kept front and center. In a recently released statement, Tim Delaney, President and CEO of the National Council of Nonprofits, placed the fate of nonprofits under tax reform as it is currently written in a multidimensional context:

The cost of tax reform is too high if children cannot get the food, shelter, and support they need. The price is too great if citizens can no longer find a haven in charitable nonprofits like houses of worship from the caustic partisan politics ripping our country apart. And we as a nation cannot afford tax reform if it forces our government to make false choices between the domestic needs of our people and our common defense. Fixes are readily available to overcome these and many other fatal flaws in the tax reform bill released today, but it will require reasonable people in Congress agreeing to agree for a change.

A memo from William C. Daroff, Senior Vice President for Public Policy, entitled “Comprehensive Tax Reform: Impact on Federations,” laid out JFNA’s overview. “From a fundraising perspective, if the tax bill becomes law before the end of the year, it presents tax planning opportunities for our donors, because as a general rule, the value of charitable contributions for many will be greater in 2017 than in 2018.” The memo also urges its readers to proactively consider the fundraising risks and benefits of the tax reform plan as currently written.

Bishop Frank J. Dewane of Venice, Florida, has written to Congress about a larger context: “You are urged to recognize the critical obligation of creating a just framework aimed at the economic security of all people, especially the least of [them].” Is this not the lens the nonprofit community should use when evaluating the proposed changes? Is protecting or enhancing the ability of nonprofits to raise funds enough to protect the poor and vulnerable from the potential negative outcomes of Trump-style tax reform? Making it harder to raise funds can harm nonprofits’ ability to fulfill their missions. But is not greater harm possible if the overall changes being proposed severely limit government’s ability to provide critical services and supports, or if it hurts the overall economy? If rates are cut as broadly as is proposed, and the resulting increase in the national debt hurts the economy as badly as many economists predict, will not the harm be even greater for the nation—and for nonprofits, which will face a very challenging environment with a less robust government to serve as a backstop?

Nonprofit leaders should not shy away from looking at these larger impacts and be willing to consider that what might be good for the nation might not be optimal for their single organization. That balance is difficult, but it is the work leaders must do.—Marty Levine

About the author
Martin Levine

Martin Levine is a Principal at Levine Partners LLP, a consulting group focusing on organizational change and improvement, realigning service systems to allow them to be more responsive and effective. Before that, he served as the CEO of JCC Chicago, where he was responsible for the development of new facilities in response to the changing demography of the Metropolitan Jewish Community. In addition to his JCC responsibilities, Mr. Levine served as a consultant on organizational change and improvement to school districts and community organizations. Mr. Levine has published several articles on change and has presented at numerous conferences on this subject. A native of New York City, Mr. Levine is a graduate of City College of New York (BS in Biology) and Columbia University (MSW). He has trained with the Future Search and the Deming Institute.

More about: Nonprofit NewsPolicyTax Policy

Our Voices Are Our Power.

Journalism, nonprofits, and multiracial democracy are under attack. At NPQ, we fight back by sharing stories and essential insights from nonprofit leaders and workers—and we pay every contributor.

Can you help us protect nonprofit voices?

Your support keeps truth alive when it matters most.
Every single dollar makes a difference.

Donate now
logo logo logo logo logo
See comments

You might also like
New York and Other States Move to Fix Nonprofit Contracting Delays
Lauren Girardin
Crafting Elements of a 2029 Agenda: A New Fair Deal
Ann Lehman
Trump Budget Bill Spells Trouble for Nonprofits
Isaiah Thompson
How Trump’s “Big, Beautiful Bill” Hurts Youth Mental Health
Megan Kerns
Holding the Line for LGBTQ+ Youth: Community, Care, and Resistance
Deepa Iyer
Trump Moves to Gut Low-Income Energy Assistance as Summer Heat Descends and Electricity Prices Rise
Conor Harrison, Elena Louder, Nikki Luke and Shelley Welton

Upcoming Webinars

Group Created with Sketch.
July 24th, 2:00 pm ET

Organizing in Divided Times

The Relational Infrastructure We Need to Protect Democracy

Register
Group Created with Sketch.
September 24th-25th, 2:00 pm ET

Advanced QuickBooks for Nonprofits

Expert Guidance for Experienced QuickBooks Users

Register

    
You might also like
An aerial view of New York City buildings during the daytime.
New York and Other States Move to Fix Nonprofit Contracting...
Lauren Girardin
A group of children hold signs with pictures of the Earth and slogans such as "Save Our Future."
Crafting Elements of a 2029 Agenda: A New Fair Deal
Ann Lehman
US Capitol Building
Trump Budget Bill Spells Trouble for Nonprofits
Isaiah Thompson

Like what you see?

Subscribe to the NPQ newsletter to have our top stories delivered directly to your inbox.

See our newsletters

By signing up, you agree to our privacy policy and terms of use, and to receive messages from NPQ and our partners.

  • About
  • Advertise
  • Careers
  • Contact
  • Copyright
  • Donate
  • Editorial Policy
  • Funders
  • Submissions

We are using cookies to give you the best experience on our website.

 

Non Profit News | Nonprofit Quarterly
Powered by  GDPR Cookie Compliance
Privacy Overview

This website uses cookies so that we can provide you with the best user experience possible. Cookie information is stored in your browser and performs functions such as recognising you when you return to our website and helping our team to understand which sections of the website you find most interesting and useful.

Strictly Necessary Cookies

Strictly Necessary Cookie should be enabled at all times so that we can save your preferences for cookie settings.

If you disable this cookie, we will not be able to save your preferences. This means that every time you visit this website you will need to enable or disable cookies again.