Monday, January 7, 2013
What does the American Taxpayer Relief Act of 2012 mean for the nonprofit sector and philanthropy? Below are the main provisions affecting charitable giving:
- Tax rates are increased to 39.6 percent (previously 35%) for individuals earning $400,000 and households earning $450,000 or more a year
- ATRA legislation did not include any caps on itemized deductions, including those for charitable gifts
- ATRA re-instated the "Pease Limitation," returning Clinton-administration limits on itemized deductions for those earning $300,000 or more a year
- Congress also voted to extend the IRA Charitable Rollover for 2012
The Urban Institute has released this brief analysis of the law's impact on nonprofits, which suggests impact on charitable giving may not be as pronounced as some have feared. More information and perspective on the legislation is available below:
- The Fiscal Cliff Legislation: A Primer for Nonprofits on Its Provisions (Nonprofit Quarterly)
- Nonprofits Call Cliff Deal a Victory on Giving Incentives (Chronicle for Philanthropy)
- Message to Members and Analysis of American Taxpayer Relief Act of 2012(Council on Foundations)
- American Taxpayer Relief Act: Key Elements of the Law (National Council of Nonprofits)
- IRA Charitable Rollover Is Back (Wall Street Journal)