Second Universal Charitable Deduction Legislation Introduced

Representative Danny Davis (D-IL) introduced new legislation (H.R. 1260) aimed at increasing the number of Americans who give to charity by allowing for an above-the-line tax deduction. The bill would provide a way for “all taxpayers regardless of whether a taxpayer itemizes deductions” to receive a tax deduction on their charitable contributions.
 
Unlike the bills in the previous Congress from Representative Mark Walker (R-NC) and Senator James Lankford (R-OK), Representative Davis’ bill puts no additional limit on the amount that can be deducted beyond the existing limit of 50% of adjusted gross income.
 
H.R. 1260 is the second bill to be introduced in this Congress that aims to expand the charitable deduction to more taxpayers. It is very similar to the bill from Representatives Henry Cuellar (D-TX) and Chris Smith (R-NJ) (H.R. 651), which was introduced in January of this year.
 
A new study points to concerning trends in charitable giving since the 2017 tax law took effect and affirms the need for a universal charitable deduction. According to a recent Wall Street Journal article, “charitable revenue from donations of at least $1,000 increased by 2.6% in 2018, according to Monday’s report from the Association of Fundraising Professionals, and there were signs that the tax law is discouraging some gifts. The number of donors declined 4.5% last year and donations under $250 dropped by 4.4%, while donations between $250 and $1,000 also dropped.”