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Obama's Plan to Reduce Charitable Deductions for the Wealthy Draws Criticism
Chronicle of Philanthropy ^ | Feb 27,2009 | Suzanne Perry

Posted on 02/28/2009 2:21:37 PM PST by SeekAndFind

Some charities and nonprofit experts are worried that President Obama’s proposal to impose new limits on charitable tax deductions for wealthy people would dampen giving at a time when charities are under severe strain because of the recession.

“During the current economic downturn, which has forced nonprofits to do more with less, any proposal which would result in a decrease in private giving will be a disaster for America’s charities, and for those who depend upon them,” said United Jewish Communities, an umbrella group for Jewish social-service charities.

Mr. Obama proposed the new caps on Thursday as a way to finance changes in the country’s health-care system.

In a document outlining his 2010 budget plans, President Obama proposed limiting the value of the tax break for itemized deductions, including donations to charity, to 28 percent for families making more than $250,000. In other words, taxpayers would save 28 cents on their federal income taxes for each dollar donated.

That would reduce by as much as 20 percent the amount wealthy taxpayers could get in tax breaks. Under the current system, taxpayers who are in the 33 percent or 35 percent tax brackets use that rate to claim deductions.

(Excerpt) Read more at philanthropy.com ...


TOPICS: Business/Economy; Culture/Society; Government; News/Current Events
KEYWORDS: bho44; bhobudget; charity; deductions; philanthropy; taxincrease

1 posted on 02/28/2009 2:21:38 PM PST by SeekAndFind
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To: SeekAndFind

Obama’s reasoning is that the proposal on itemized deductions — which would also apply to claims such as mortgage interest — would raise $318-billion over 10 years. That money would help pay for a 10-year $630-billion reserve fund designed to help make health care more affordable and available.


2 posted on 02/28/2009 2:22:58 PM PST by SeekAndFind
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To: SeekAndFind

In the name of fairness, of course.


3 posted on 02/28/2009 2:24:14 PM PST by Jeff Chandler (We seem to be experiencing a tsunami of tsunami analogies.)
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To: SeekAndFind

Today there was another thread about the mortgage interest deduction being limited for those making over $250,000/year. Is this in addition?


4 posted on 02/28/2009 2:24:21 PM PST by 17th Miss Regt
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To: SeekAndFind

“During the current economic downturn, which has forced nonprofits to do more with less, any proposal which would result in a decrease in private giving will be a disaster for America’s charities, and for those who depend upon them,” said United Jewish Communities, an umbrella group for Jewish social-service charities.

Yet didn’t American Jews overwhelmingly vote for Obama? Surely they knew he was a closet socialist.


5 posted on 02/28/2009 2:24:36 PM PST by caseinpoint (Don't get thickly involved in thin things)
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Government will appropriate to iteself all possible and potential charitable funds, reserving to itself the role of charity.

Didn’t you get the memo?


6 posted on 02/28/2009 2:27:45 PM PST by combat_boots ("In a time of universal deceit, telling the truth is a revolutionary act."Aldous Huxley)
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To: 17th Miss Regt
Today there was another thread about the mortgage interest deduction being limited for those making over $250,000/year. Is this in addition?

Yes. The Wall Street Journal reports these proposals (limits to mortgage and charity deductions) in their Thursday (Feb 26,2009) headline. This represents a double whammy to the wealthy. This is exactly in keeping with what he said to Joe the Plumber.
7 posted on 02/28/2009 2:31:25 PM PST by SeekAndFind
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To: SeekAndFind

Taxing charities? I’m sure that’s the ‘change’ people had in mind.


8 posted on 02/28/2009 2:31:43 PM PST by eclecticEel (Wall Street isn't a charity ... so why are we giving them money?)
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To: eclecticEel

Technically it isn’t taxing charities. It is LIMITING DEDUCTIONS to charitable giving.


9 posted on 02/28/2009 2:33:21 PM PST by SeekAndFind
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To: SeekAndFind
Obama still hasn't learned that liberalism destroys the economy. He might have learned this if he actually ran a business in the real world instead of sucking the teat of the ivory towers. Higher tax rates hurt the economy during normal times but they cause great depressions and deep recessions when they are forced on an economy that is already struggling. He's an economic train wreck.
10 posted on 02/28/2009 2:46:01 PM PST by peeps36 ( Al Gore. Is A Big Fat Lying Hypocrite. He Pollutes The Air By Opening His Big Mouth)
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To: SeekAndFind
An example from the article:

To illustrate, Mr. Sharpe offers the example of a wealthy donor in the top tax bracket who makes a $100,000 gift. The donor currently would save $35,000 in taxes, or 35 percent of the gift. Under President Obama’s proposal, that same donor would save only $28,000, or 28 percent — a difference of $7,000.

I'm sorry but if someone is wealthy enough to donate $100,000 to charity... but a difference in his tax writeoff of about $7,000 will stop him from donating... then he maybe needs to reexamine his reasons for being "charitable".

11 posted on 02/28/2009 2:46:25 PM PST by saquin
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To: SeekAndFind
Donations to ACORN will continue to receive 150% deduction against taxes.

Plus a one night stay in the Lincoln bedroom.

12 posted on 02/28/2009 2:46:43 PM PST by TYVets
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To: SeekAndFind

Do I get this right? If people make over $250,000 they will not be able to claim payments on their home as a mortgage deduction?? Thats crazy. Insane.


13 posted on 02/28/2009 2:49:06 PM PST by Venturer
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To: Venturer

No, they will still be able to claim mortgage payments as a deduction. I believe it will be a limit on how much they could claim and I think there’s something about a limit on how much they could claim on a second or vacation home.


14 posted on 02/28/2009 2:53:30 PM PST by saquin
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To: combat_boots
“Government will appropriate to iteself all possible and potential charitable funds, reserving to itself the role of charity”.
I somewhere missed the memo or amendment to the Constitution that stated everything belongs to the government, and you may only use what we deem you need. I propose we start a “nose” rebellion. Every time a politician, on any level, tells us they need to raise taxes for the needs of government, we punch them in the nose. Between their need for frequent medical care, and the cost of trying and incarcerating us, it could make a difference. If nothing else, the group photos of Obama, Reid, Pelosi, Dodds, and Franks would be amusing.
15 posted on 02/28/2009 2:57:38 PM PST by bitterohiogunclinger (America held hostage - day 118)
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To: saquin
then he maybe needs to reexamine his reasons for being "charitable".

No, maybe he simply needs to tell hussein to shove it. - We are not here to further the socialist agenda by being in any way charitable.
I am currently moving 100% into areas that have no taxable exposure at all, and I am winding down 2 different businesses, as well, so as to stay unexposed.

I am not here to further these agenda items in any way at all, nor am I going to be a useful idiot to do so.

16 posted on 02/28/2009 2:58:39 PM PST by bill1952 (McCain and the GOP were worthless)
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To: SeekAndFind
There is now a hard cap on the middle class. It is $250k. Don't even try to get over it.

The elite don't want to have to rub shoulders with non-Ivy League people who's only accomplishment in life is in working hard and being successful.

17 posted on 02/28/2009 2:59:04 PM PST by SampleMan (Socialism and Liberty are mutually exclusive.)
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To: SeekAndFind

Whose donations build the new hospital wings and research centers - the wealthy. The health care in this country is so good because of so many generous wealthy people.


18 posted on 02/28/2009 3:05:22 PM PST by keepitreal (Obama brings change: an international crisis (terrorism) within 6 months)
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To: 17th Miss Regt
Today there was another thread about the mortgage interest deduction being limited for those making over $250,000/year. Is this in addition?

It appears to be aimed at itemized deductions for anyone making over $250,000. Mortgage interest and charitable deductions are usually the big hitters, but I'll bet any itemized deduction will be limited to 28% even though the marginal rate will be 39.6%.

19 posted on 02/28/2009 3:08:41 PM PST by Myrddin
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To: Venturer
If people make over $250,000 they will not be able to claim payments on their home as a mortgage deduction??

Of course. We don't want to encourage the wealthy to buy homes we want to give to deadbeats and illegals.

20 posted on 02/28/2009 3:35:55 PM PST by Right Wing Assault
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To: Right Wing Assault

People everywhere who depend on church charities and other kinds of charitable organizations and institutions are going to be devastated by these proposals.

Obambi is cutting his own political throat by such acts and it couldn’t happen quick enough for me.


21 posted on 02/28/2009 3:44:40 PM PST by Ev Reeman
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To: Right Wing Assault

People everywhere who depend on church charities and other kinds of charitable organizations and institutions are going to be devastated by these proposals.

Obambi is cutting his own political throat by such acts and it couldn’t happen quick enough for me.


22 posted on 02/28/2009 3:44:41 PM PST by Ev Reeman
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To: Right Wing Assault

People everywhere who depend on church charities and other kinds of charitable organizations and institutions are going to be devastated by these proposals.

Obambi is cutting his own political throat by such acts and it couldn’t happen quick enough for me.


23 posted on 02/28/2009 3:44:45 PM PST by Ev Reeman
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To: Right Wing Assault

People everywhere who depend on church charities and other kinds of charitable organizations and institutions are going to be devastated by these proposals.

Obambi is cutting his own political throat by such acts and it couldn’t happen quick enough for me.


24 posted on 02/28/2009 3:44:51 PM PST by Ev Reeman
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To: Ev Reeman

I now only donate money/time/items to go to our troops/vets.

The ones who voted for the mess can learn to live within the means of their food stamps.


25 posted on 02/28/2009 3:49:58 PM PST by Lera
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To: SeekAndFind

I am conflicted. On the one hand, I want to see a policy that promotes charitable giving but on the other hand, since most of the recipients are populated with Obama supporters, there is nothing like it to see them get their comeuppance.


26 posted on 02/28/2009 3:50:13 PM PST by MarkT
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To: SeekAndFind

IMHO Obama doesn’t care about charities. How much did he donate of his income to charity? He is an empty suit — all talk and someone who wants to redistribute wealth and if it hurts charities, that is their problem.


27 posted on 02/28/2009 4:00:25 PM PST by PhiKapMom ( BOOMER SOONER! Mary Fallin for OK Governor in 2010! LetsGetThisRight.com)
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To: PhiKapMom

Obambi is just another Madoff where charities are concerned.


28 posted on 02/28/2009 4:02:10 PM PST by Ev Reeman
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To: Ev Reeman

Very good comparison to Madoff on charities.


29 posted on 02/28/2009 4:05:35 PM PST by PhiKapMom ( BOOMER SOONER! Mary Fallin for OK Governor in 2010! LetsGetThisRight.com)
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To: SeekAndFind
I'll wager that the charities most affected will be more leftist in orientation, and thus would have cheered on the election of UhBama. I wonder how they feel about him now.
30 posted on 02/28/2009 4:08:21 PM PST by theBuckwheat
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To: theBuckwheat

I was thinking that exact same thing!


31 posted on 02/28/2009 4:12:28 PM PST by Ev Reeman
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To: Ev Reeman

And I’ll quintuple that!


32 posted on 02/28/2009 4:17:48 PM PST by Right Wing Assault
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To: SeekAndFind

A community organizer running the country?—exactly what was expected.


33 posted on 02/28/2009 4:21:09 PM PST by lonestar
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To: saquin
then he maybe needs to reexamine his reasons for being "charitable".

At the high end, charity is business. Very few people wake up and decide to donate $100k to the art museum.

Charities have development directors who find potential donors and build proposals to get them to fund projects. These proposals will include the terms of the gift, the project it will fund and show the tax benefits for the donor.

Often these are gifts in the millions involving trusts, donations in kind, matching grants, etc. The tax benefits are a very important part of the calculation.

Also, remember that these gifts are from capital, not from income. That $7000 deduction against an income of $250k represents 10% of their tax bill.

34 posted on 02/28/2009 4:21:10 PM PST by MediaMole
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To: SeekAndFind
Don't worry. Obama has got it covered. He'll pick up the slack with more tax revenues.

... sarc.

35 posted on 02/28/2009 4:26:15 PM PST by dhs12345
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To: saquin

And mebbe government should not strive to discouage private acts of charity or to make government the primary agency of charitable good works, using the wealth produced by private citizens.
Socialism has so many faces, so many nefarious ways to diminish the individual citizen.


36 posted on 02/28/2009 4:40:10 PM PST by Elsiejay
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To: SeekAndFind

Be’elzebama is happy to steal the contributions of the rich. What does he care about rich folk helping people if he doesn’t get the credit and the votes?


37 posted on 02/28/2009 4:40:57 PM PST by richardtavor (Pray for the peace of Jerusalem in the name of the G-d of Jacob)
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To: saquin
Not to be critical at all, but I don't think that you understand the picture, here, saquin. A wealthy person may have $100,000 to donate, but if he is penalized by $7,000, then he may only be able to contribute %93,000 instead of $100,000. Now that would be very little impact to the rich person, but the $7,000 loss to the charity might be devastating to the charity. I don't know about your finances, but you sit down every year and try to budget whether you are rich or not...I personally will try to come up with other giving options because charity is important to me. But I still have limited funds, especially with Obamaziation trying to suck up all the money of our country for government control. Obama is trying to take the control of who to give to away from the person that owns the wealth, and take the power into his own hands. The net effect is that the worthwhile causes that the rich are giving to will be shifted to organizations such as ACORN.
38 posted on 02/28/2009 4:54:52 PM PST by richardtavor (Pray for the peace of Jerusalem in the name of the G-d of Jacob)
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To: saquin

You miss the point. Its not about the donor’s reasons for giving. Its the encouragement that the tax deduction provides.

Less economic benefit >> smaller donations >> less well off charities >> BIGGER GOVERNMENT.

Got to think like a socialist.


39 posted on 02/28/2009 5:30:25 PM PST by sgtyork (The secret of happiness is freedom, and the secret of freedom, courage. Thucydides)
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To: Ev Reeman
People everywhere who depend on church charities and other kinds of charitable organizations and institutions are going to be devastated by these proposals.

Obambi is cutting his own political throat by such acts and it couldn’t happen quick enough for me.

Hardly. The "correct" charities will get government subsidies to make up the difference. It's actually a fairly shrewd move on Obama's part as it will help increase dependency on the Democratic Party.

40 posted on 02/28/2009 6:09:18 PM PST by lgwdnbdgr
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To: SeekAndFind

The true reasoning is that they want these people to turn instead to Uncle Sugar Government and become thralls to the Democrats. They are truly despicable people.


41 posted on 02/28/2009 7:48:59 PM PST by Dr.Deth
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To: Dr.Deth

You are exactly right. Obama wants to see the end of private charities, religious or secular. He wants as many people as possible dependent on the US Government as possible. His budget and economic STIMPAC will add to the ranks of the unemployed. Socialism is his goal. It has worked so well in the past. Why not try again. Red China, North Korea, USSR, NAZI Germany, Fascist Italy, and so many European countries. While these may seem extreme it is only a matter of time before we get so used to government running our lives that we will learn to put up with anything.


42 posted on 03/01/2009 11:33:17 AM PST by SEAL76
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