December 9, 2010 | Read Time: 1 minute
Nonprofit advocates should fight a provision on the estate tax that is part of a tax deal struck this week between President Obama and Congressional Republicans because it would dampen charitable giving, says Independent Sector, the coalition of charities and foundations.
“This is not a done deal,” Diana Aviv, the group’s president, told her Twitter followers. “There is time to weigh in. We can’t afford to sit this one out.”
The president and Republicans agreed to reinstate the estate tax, which expired this year, for two years at a 35-percent rate, while exempting the first $5-million from taxes ($10- million for couples).
Independent Sector, arguing that the tax encourages wealthy people to donate to charity to shield some assets from taxation, favors leaving it at 2009 levels—a 45 percent rate, with the first $3.5-million exempted ($7-million for couples).
Congress has not yet endorsed the estate-tax deal, and many Democrats agree with Independent Sector that it should be less generous to the wealthy.
Independent Sector has a call to action on its Web site, saying the estate-tax deal would also “add tens of billions of dollars to the deficit each year.”
But Ms. Aviv is waging the battle on Twitter. “Think who benefits if a couple’s 1st $10 mil I kid U not first $10 mil are exempt. A lot of those taxed dollars were donated to the sector,” she wrote.
