Would you give as much as you’re currently giving to your church or charities of choice whether or not you were entitled to deduct the amount of the contributions from your taxable income?
The charitable contribution deduction has been available to American taxpayers in some form or fashion since 1917. This incentive (some may say reward), has been welcomed by both the giver and the receiver for obvious reasons.
But in the midst of the “fiscal cliff” discussions, the deduction is now in danger.
The Bowles-Simpson Report of 2010 called for it to be replaced with a much smaller tax credit. Others have qualified the deduction as a “loophole” and advocated for its complete elimination.
You would expect the president of a non-profit Christian ministry to be in favor of maintaining the charitable contribution deduction, and indeed, I do. Yet, the enthusiasm of my advocacy extends well beyond concern about contributions to Focus on the Family.
The fact of the matter is this: nations that support charitable deductions have a more generous spirit.
Writing in The New York Times earlier this month, Dr. Robert J. Shiller, professor of economics and finance at Yale University, suggested the deduction should not only be preserved, but expanded. He believes that taxpayers who don’t itemize their deductions should still be allowed to deduct their charitable contributions.
“Some of the greatest moments in American history have been acts of charity,” wrote Dr. Shiller.
Indeed, last year alone Americans gave nearly $300 billion away – and were ranked No. 1 among countries globally according to the Charities Aid Foundation of Britain’s World Giving Index.
“The proper aim of giving,” wrote C.S. Lewis, “is to put the recipients in a state where they no longer need our gifts.”
It would behoove our leaders to appreciate the fact that though the gifts Americans give are given for all kinds of reasons – it is always culturally dangerous and ultimately counterproductive for governments to discourage generosity.
For the sake of those most in need in this country who are helped by the churches and charities of this country, I pray that Congress sees the wisdom in maintaining the charitable contribution deduction.