February 12, 1998 | Read Time: 2 minutes
As the 1998 Congressional season begins in earnest, non-profit officials are pressing lawmakers to pass several proposals to increase charitable giving. Here’s a look at the key items on the agenda:
Gifts to foundations. A tax break that encourages people to make gifts of appreciated stock to private foundationswill expire on June 30. The provision allows people to claim a deduction on their income taxes for the full market value of gifts of stock.
President Clinton has recommended a one-year extension of the break through June 30, 1999. If Congress does not renew the break, beginning on July 1 of this year donors will only be able to deduct the amount they paid for the stock.
Expanding eligibility for deductions. A bill introduced in the House of Representatives last year, now supported by a bipartisan group of 53 members, would provide a limited version of the charitable deduction for many of the estimated 84 million people who now cannot receive a break for their gifts because they do not itemize on their tax returns.
The proposal, H.R. 2499, would allow people who do not itemize to take a tax write-off of 50 per cent on the value of their charitable contributions that exceed $500 for a given year. That means a person who contributed a total of $1,000 would be able to claim a charitable deduction of $250.
Donations from retirement funds. Legislation pending in Congress would provide an incentive to donors who want to give funds to charity from their individual retirement accounts.
Under federal law, Americans may withdraw funds without penalty from their I.R.A.’s when they reach age 591/2. But people are subject to income tax on the amount taken out, even if they give the funds directly to charity.
The bill, H.R. 2821, would allow taxpayers to roll over I.R.A. assets directly to charity without having to count the funds as income and pay taxes on them.
The measure would also give a better deal to people who want to put I.R.A. assets directly into a planned gift.
