ALEXANDRIA, VA. (November 19, 2013)—Mental Health America is joining tomorrow with hundreds of nonprofits from across the country to warn Congress of the cascading economic and social consequences of any limits to the charitable tax deduction. The warning comes as federal lawmakers consider reducing the federal budget deficit and a range of tax reforms designed to grow the economy.
The Charitable Giving Coalition, a group of more than 60 nonprofits, foundations and charitable organizations, including Mental Health America, said proposals to the limit the charitable deduction would devastate the nonprofit sector that millions rely on for jobs, support and services.
“To keep pace with a growing demand for vital community services, Congress should be encouraging more charitable giving, not less,” said David Shern, Ph.D., interim president and CEO of Mental Health America. “Under proposed changes, the nonprofit sector, which employs one out of ten Americans and generates more than $1 trillion every year for important human services, would suffer a loss of billions of dollars in donations used to aid the most vulnerable, educate, heal, nurture and innovate–often in ways that government and the private sector cannot.”
Members of the Coalition are meeting on Wednesday, November 20, in Washington, D.C. with dozens of individual lawmakers and their staff to educate them about the lifeline charitable giving represents.
According to a new report issued by Giving USA, those who itemized their charitable contributions represent 81 percent of the total estimate (nearly $229 billion) of giving by individuals in 2012. Estimates show that for every dollar subject to the deduction, the public typically receives $3 of benefit. It is unlikely government could find a more effective way to leverage private investment in community services.
“Charitable giving provides a lifeline for Mental Health America and our 240 affiliates around the country,” said Dr. Shern.
He said Americans support the charitable deduction because it works. According to a United Way Worldwide survey, nearly 80 percent of Americans believe reducing or eliminating the charitable tax deduction would have a negative impact on charities and the people they serve. Of those who indicate they would reduce charitable giving, the majority (62 percent) would have to decrease their contributions by 25 percent or more. Two out of every three Americans (67 percent) are opposed to reducing the charitable tax deduction.
As the tax reform debate continues, Mental Health America plans to be active in making sure lawmakers understand what is at stake for communities and charitable giving, including a new Protect Giving YouTube channel and a petition drive.
“Given the tremendous needs in our communities, we simply can’t afford to weaken a 100-year-old American tradition that encourages giving,” said Dr. Shern. “We are committed to working with elected officials to identify the best ways to protect the unique value of the charitable deduction.”