http://www.independent.org/publications/the_lighthouse/detail.asp?id=414#1976
Don’t Cut Charitable Deductions
President Barack Obama proposes to help pay for his jobs plan by reducing the itemized tax deductions of taxpayers who earn $200,000 or more each year, including deductions for charitable contributions. If enacted, this measure would reduce the funds donated to charity—perhaps significantly. Households that reported annual incomes of $200,000 or more account for 54.9 percent of the charitable deductions claimed on federal income tax returns for 2009, according to Independent Institute Research Fellow Craig Eyermann. Moreover, charitable giving by wealthy individuals has been a vital source of funding for medical research on uncommon diseases that receive no government dollars.
“It isn’t the tax deduction that motivates such individuals to give,” Eyermann writes in the Sacramento Bee. “But the tax deduction enables many Americans to give more than they might be able to give otherwise.”
Eyermann cites the example of Spinal Muscular Atrophy Foundation, an organization founded by a Goldman Sachs executive whose daughter was diagnosed with spinal muscular atrophy, a debilitating and as yet untreatable disease that has stricken an estimated 25,000 individuals in the United States. Unfortunately, non-profits that rely on private donations could take a huge hit if federal tax deductions for charitable giving were reduced. Even a mere 5 percent reduction in charitable donations would amount to a cut of almost one billion dollars. “That’s a huge price to pay for short-lived ‘stimulus’jobs,” Eyermann concludes.
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