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 LEGISLATIVE
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Lawmakers propose increasing mileage deduction rate for charitable vehicle use (June 19, 2008)
Efforts to increase the mileage deduction rate for charitable vehicle use have been proposed in the House this week. Representative John Lewis (D-GA) introduced H.R.6283 to permanently increase to 40 cents per mile the standard deduction rate offered on vehicle use for charitable purposes under the Internal Revenue Code. The current deduction rate is $0.14/mile. H.R.6283 is identical to the bill introduced May 19 by Senator Charles Schumer (D-NY), The Reimbursing Our American Drivers (ROAD) Act (S.3032). Also, in the Ways and Means Committee markup on the Alternative Minimum Tax relief bill yesterday (see above article), Representative Kevin Brady (R-TX) offered an amendment that among other things, would increase the mileage deduction rate for volunteer use of personal vehicles for charitable purposes to 25.4 cents to reflect the rise in fuel prices since the beginning of the year. That measure was defeated largely along party lines because it would have removed one of the revenue raisers in the AMT bill. Source: BNA Daily Tax Report, Tax Analysts (via Independent Sector’s Policy Digest)
Recent Editorials in Daily News (San Fernando Valley) and The Press-Enterprise (Riverside) by Sushma Raman, President Southern California Grantmakers Tracking gender, race would hinder charitites
Relief bill asks too much: Data-tracking AB 624 is intrusive and diverse
Bill Requiring Diversity Data Collection and Reporting in California
(January 29, 2008)
The California Assembly passed AB 624, a bill that would require foundations (private, public operating, and corporate) with assets of greater than $250 million to disclose the race/ethnicity, gender and sexual orientation of their boards and staff, as well as collect and report data for how many and what percentage of total grant dollars were awarded to organizations where at least 50% of the board and staff are members of ethnic minorities, lesbians, gays, bisexual, and/or transgendered individuals. Further, these foundations would be required to report a breakdown of the number of grants and percentage of dollars that go to organizations that serve different ethnic groups or sexual orientations, as well as the percentage of contracts awarded to businesses owned by members of those groups. The bill now goes to the California Senate.
There has been, not surprisingly, a strong opposition to this bill from the California grantmaking community.
* The three California Regional Associations of Grantmakers, and the Council on Foundations all oppose this measure. The COF press release about their positions.
* The Nonprofit & Unincorporated Organizations Committee of the Business Law Section of the State Bar Association of California also opposed the bill, on grounds that included privacy concerns, and this was prior to a later amendment that added collecting data on the sexual orientation of staff, trustees and grantees of foundations.
While many foundations, leaders and associations in philanthropy recognize that, historically, there have been a disproportionately small percentage of grants and dollars awarded to communities of color, the GLBT community and other under-served populations, there is significant concern that this bill is not the most useful approach to addressing this disparity. Further, there are significant concerns about the invasion of personal privacy of foundation and nonprofit staff and trustees, and finally, about the administrative burdens this bill will impose.
It is worth noting that the impetus for this bill came from the Greenlining Institute studies, Fairness in Philanthropy.
* The Chronicle of Philanthropy has written about the bill and its potential impact.
* The Assembly’s analysis of the bill.
* Op-ed published in Los Angeles time, the President and Vice President of Community Advocates opposed the bill.
As of yet, AGM has not seen anything to suggest that other states are considering this type of action. However, we will continue to monitor the situation in California, as well as to see if other areas of the country begin to consider similar legislation.
Panel Addresses Diversity in the Nonprofit Sector (October 9, 2007)
Witnesses at a September 25 hearing of the House Ways and Means Oversight Subcommittee told lawmakers that charitable organizations are not always able to adequately meet the needs of diverse communities. When asked how Congress could better help charities serve Americans, Lesley Grady, Vice President of the Community Foundation of Greater Atlanta, urged lawmakers to pass legislation (HR 1419:/ S819:)the Public Good Rollover Act of 2007, which would make permanent a provision allowing tax-free charitable contributions from individual retirement accounts (IRA). Elizabeth Boris, Director for the Center on Nonprofits and Philanthropy with the Urban Institute, focused her comments on how the Form 990 could be improved to capture better information on donations and stated that electronic filing will improve the quality and timeliness of the information reported on the return, thus facilitating greater transparency. Other witnesses included Susan V. Berresford, president and CEO of the Ford Foundation, and Kevin M. Brown, chief operating officer of the American Red Cross. Source: BNA Daily Tax Report, Tax Analyst via Independent Sector.
Limited IRA Charitable Rollover Bill Introduced (October 9, 2007)
A bill (H.R.3596) to make permanent the IRA charitable rollover provision of last year’s Pension Protection Act has been introduced by Rep. Nick Lampson (D-TX). The “Charitable Tax Relief Act of 2007” extends the existing incentive for donations of charities of IRA funds by persons aged 70 ½ and older. The Lampson bill does not expand the law to additional types of charities and foundations, lower the age limit nor lift the cap on donations, as is incorporated in S.819/H.R.1419, the “Public Good IRA Rollover Act of 2007.” Source: Tax Analysts via Independent Sector.
Hearing on Charitable Organizations Announced (September 18, 2007)
House Ways and Means Oversight Subcommittee Chairman John Lewis (D-GA) announced September 17 that the panel will hold a hearing to review whether tax-exempt charitable organizations are serving the needs of diverse communities. The hearing will discuss: the extent to which philanthropic dollars are being directed toward diverse communities; the actions tax-exempt organizations are taking to deal with issues and challenges that have arisen in identifying the needs of diverse communities; and the partnerships between governments and charitable organizations that are needed to reach and serve diverse populations. The Subcommittee will hear testimony on why developing a plan to serve diverse communities is important and beneficial. The hearing will take place on Tuesday, September 25. Witnesses have not yet been announced. (article via Independent Sector’s Policy Watch)
The bi-partisan technical corrections bill (S.1974/HR 3361) for the Pension Protection Act (August 7, 2007) was introduced in the Senate on August 2 and in the House on August 3 by the Chairmen and Ranking Members of the Senate Finance and the Health, Education, Labor and Pensions Committees and the House Ways and Means and the Education and Labor Committees. Access this information on HR3361 at: http://thomas.loc.gov/cgi-bin/bdquery/z?d110:h.r.03361
House Ways & Means Committee Testimony on Charities (July 25, 2007)
On July 24, the House Ways & Means Committee convened a hearing on tax-exempt charitable organizations. Witnesses providing testimony included Diana Aviv, President & CEO of the Independent Sector, and Steve Gunderson, President & CEO of the Council on Foundations. Copies of all witnesses’ testimony may be found here: http://waysandmeans.house.gov/hearings.asp?formmode=detail&hearing=577
Senate Finance Committee Expresses Concern About IRS Report on Compliance in Nonprofit Sector (July 25, 2007)
The Senate Finance Committee has issued a statement [http://finance.senate.gov/press/Gpress/2007/prg072307.pdf ] about the recent IRS report on compliance issues among tax exempt entities http://finance.senate.gov/press/Gpress/2007/prg072307a.pdf. The IRS report outlines issues including continued concerns about governance; the use of tax exempt organizations as accommodation parties for abusive tax transactions; improper valuation of charitable contributions; and the absence of transparency.
Ways and Means Committee Announces Overview Hearing on Tax-Exempt Organizations (July 10, 2007)
House Ways and Means Oversight Subcommittee Chairman John Lewis (D-GA) has announced (http://waysandmeans.house.gov/hearings.asp?formmode=view&id=6224) that the panel will hold an overview hearing on tax-exempt organizations, focusing on charities and foundations described in Internal Revenue Code section 501(c)(3). According to the Subcommittee’s news release, there have been several recent legislative and administrative developments that relate to 501(c)(3) organizations and may affect their operations. Invited witnesses will represent the Internal Revenue Service, Government Accountability Office, Independent Sector, and the Council on Foundations. The hearing will take place on Tuesday, July 24, 2007.
Testimony at the hearing will be limited to invited witnesses, but other organizations are invited to submit comments for the record. This page http://waysandmeans.house.gov/hearings.asp?formmode=detail&hearing=577&comm=3 has information on how to submit written comments for the record.
House Ways and Means Subcommittee Calling for Comments on Impact of PPA (June 13, 2007)
In a June 12 press release, Oversight Subcommittee Chairman John Lewis (D-GA) announced that the Subcommittee is requesting written comments on Pension Protection Act of 2006 (PPA) provisions related to tax exempt organizations. From the press release: “The Subcommittee is interested in the tax-exempt community’s views on the impact of these recently-enacted provisions on charities and foundations. The Subcommittee is particularly interested in how these new rules affect, or will affect, charitable efforts and the difficulties that have arisen in implementing these provisions. Further, the Subcommittee requests comments on the provisions scheduled to expire on December 31, 2007. The deadline to submit written comments is Tuesday, July 31, 2007.” Specific submission and formatting requirements for those comments may be found at: http://waysandmeans.house.gov/hearings.asp?formmode=view&id=6116
Upcoming Ways and Means hearings (May 3, 2007)
Ways and Means Committee and staff members have indicated that there are several upcoming hearings that will address issues of importance to foundations and other nonprofits. In May, the Committee intends to hold a hearing on issues related to the charitable provisions of the Pension Protection Act; in June, the Committee will hold a hearing focusing on how tax-exempt organizations benefit rural, urban, and minority communities. Chairman Charles Rangel (D-NY) has also indicated that a hearing will be held later this year on the tax-exempt status of nonprofits. View the Ways and Means Committee’s calendar.
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