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Tax Incentives for Charity: An Overview of Legislative Proposals, Date: September 2, 2003 1 (September 2, 2003)

handle is hein.tera/crstax0062 and id is 1 raw text is: Order Code RS21144 Updated September 2, 2003 CRS Report for Congress Received through the CRS Web Tax Incentives for Charity: An Overview of Legislative Proposals Jane G. Gravelle Senior Specialist in Economic Policy Government and Finance Division Summary This reports briefly discusses the tax provisions of the Community Solutions Act (H.R. 7, which passed the House on July 19, 2001). A similar bill, also H.R. 7, was introduced in the 108th Congress. Provisions include charitable deductions for non- itemizers, rollovers of IRAs into charitable uses, a reduction in the excise tax on private foundation income, an increase in the deductions cap for corporate contributions, and several narrower provisions relating to business contributions of property and charitable remainder trusts. In 2002, the Senate Finance Committee also reported a substitute that included a number of similar provisions (The CARE Act of 2002), along with some revenue offsets (user fees and corporate tax shelters), which never saw floor action. A similar bill, S. 476. has been adopted by the Senate on April 9, 2003. The Community Solutions Act of 2001 (H.R. 7), adopted in 2001 by the House, had eight new tax provisions designed to benefit charitable giving. The bill also contained provisions relating to charitable choice (religious organizations' role in administering government programs).' The Joint Committee on Taxation projected a revenue loss of $13.3 billion over 10 years ($2.4 billion annually when fully phased in). The President had proposed three of these tax provisions in his original 2001 tax proposal, but these provisions were not included in the 2001 tax cut (P.L. 107-16). The President continued to propose revisions; his FY2004 tax proposals included most of these provisions but did not include the increase in limits for corporate contributions. S. 1924, introduced in the 107th Congress by Senators Lieberman and Santorum after discussion with the President, would provide a temporary non-itemizers deduction with a higher cap. The Senate Finance Committee reported out a version of the bill on June 18, 2002, the CARE Act of 2002, with a temporary non-itemizers deduction with both a floor and ceiling. It excluded some provisions of H.R. 7 but contained others. A similar bill, S. 476 estimated to cost $11 billion over 10 years was passed by the Senate on April 9, 2003. Congressional Research Service A+ The Library of Congress ' For a discussion of charitable choice provisions, see CRS Report RS20948, Charitable Choice Provisions ofHR. 7.

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