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May 13, 2020; NJ Spotlight

The New Jersey Senate Budget and Appropriations Committee met this week with members of the state’s nonprofit community to consider action on legislation to establish the tax deduction for charitable contributions. The bipartisan bill was favorably received.

“New Jersey’s nonprofit organizations have proven themselves time and again to be worthy of both our awe and support,” says Senate Minority Leader Tom Kean (R-Union).

“We watched as local community organizations across the Garden State rushed forward to support our residents’ needs after 9/11, superstorm Sandy, and today as we struggle with COVID-19,” says Kean, who is a primary sponsor of the tax-deduction bill.

The state is one of those most severely affected by COVID-19, with 140,743 confirmed infections and more than 9,500 deaths. As with the rest of the country, unemployment has also surged, and that has caused problems in housing, food security, and a host of other concerns on which nonprofits work.

The proposal would allow deductions for charitable gifts up to $20,000 for a married couple filing jointly, and $10,000 for single filers, according to the bill. However, this would only be in effect until the COVID-19 emergency is declared past, and it is that last provision which we believe should be changed. Indeed, after the legislation received unanimous support from the Senate committee in an 11–0 vote, some of those voting expressed interest in making it permanent.

Earlier this week, a bill was passed to allow the waiver of penalties on nonprofits not able to meet contractual obligations during the state of emergency and for six months after the state lifts it. We would love to hear from other states that have had similar policy initiatives, but we will once again take an opportunity to emphasize the importance of your state association. If you have not joined, do so today.—Ruth McCambridge