Senators Push to Expand Charitable Tax Deduction to All

Sen. Mike Lee, a Utah Republican, told nonprofit officials on Tuesday that he wants to expand a newly created tax deduction available to people who don’t itemize their tax returns. His plan would allow American families to claim up to $8,000 on their 2019 taxes, far more than the $300 break passed this spring.

Lee’s comments came during a virtual town-hall meeting hosted by the National Council of Nonprofits on Tuesday that featured a bipartisan group of lawmakers. In addition to Lee, the other Republican attending was Sen. James Lankford of Oklahoma. Democrats participating were Senators Chris Coons of Delaware, Amy Klobuchar of Minnesota, and Jeanne Shaheen, of New Hampshire.

“What we’re hoping to do, I think, is to push now for the expansion to one-third of the standard deduction for tax years 2019 and 2020,” said Lee.

The proposed universal charitable deduction builds on a temporary $300 universal charitable deduction signed into law as part of the Cares Act. Lee said the plan would allow single people to deduct up to $4,000 and married couples up to $8,000.

Nonprofit advocates have for years pushed for a charitable deduction available to people who do not itemize on their returns. They stepped up those efforts after a law passed in 2017 greatly reduced the number of Americans who itemize to about 10 percent. Researchers say nearly a quarter of people itemized before the law changed.

While the details of the proposal are still being worked out and could change, Lankford said taxpayers might still be required to retain some records of their charitable giving for potential audits. Even so, he said he doubted many would be audited.

Lee led an effort last year that recommended a significant overhaul of the charitable deduction.