Charitable giving incentives are on the federal government's docket this summer. By mid-September, the US Senate will have to decide whether to follow the Republican-dominated House of Representatives and pass the America Gives More Act. The legislation would extend three expired incentives for donations of food, conservation easements and – perhaps most significantly – donations of money from the retirement accounts of individual taxpayers aged 70 and one half or older.
The IRA Rollover (IRA stands for individual retirement accounts) was enacted in 2006 for two years and extended for short periods, but expired in 2014. The Obama administration has come out against the America Gives More Act, saying that Congressional Republicans have demanded budgetary offsets for other programmes favoured by the White House, such as education tax credits and childcare tax incentives, which are initiatives geared explicitly towards America's poor, but not for the non-targeted charitable incentives they are proposing.
Republicans in the House galvanised in support of the legislation, but Democrats were split. In a mid-term election year, it might be difficult for Senate Democrats to vote against a bill on charity supported by the nation's major non-profit trade associations such as the National Council on Nonprofits, Independent Sector and the Council on Foundations. In the end, President Obama might be faced with the uncomfortable prospect of having to veto charitable giving legislation.
Charity might also be part of the Republican agenda for the 2014 mid-term elections and the 2016 presidential election. Congressman Paul Ryan, the vice-presidential running mate of Senator John McCain in 2008, announced a comprehensive plan for solutions to poverty. Its core component combines several federal programmes – including food stamps, home-heating assistance, housing vouchers and childcare assistance – into a massive block grant to be delivered to state governments and thence to non-profits on the front line of fighting poverty. Ryan's belief is that these federal block grants will empower non-profits to both "relieve the pain of poverty (and) give people the means to get out of poverty". Ryan's plan would not restore any of the federal funds cut from anti-poverty programmes in recent years. A block grant might look big, but it would be less than the sum of its parts.
Rick Cohen is national correspondent for the Nonprofit Quarterly in Boston, Massachusetts