by Laura Walling, Senior Director of Government Relations, Goodwill Industries International
Congress has passed a number of measures that helped nonprofits during the pandemic, including measures that benefit those who donate to charities. In March 2020, Congress enacted a $300 charitable deduction for cash gifts from non-itemizers (those who take the standard charitable deduction) for 2020. The Fundraising Effectiveness Project (FEP), reports individual giving in 2020 increased 7.3 percent, compared to 2019, and the number of donors increased by 10.6 percent. Additionally, there was a 28 percent increase in gifts of $300 on December 31st—the exact amount of the current universal charitable deduction. In December, Congress extended the universal charitable deduction availability through 2021 and increased the cap to $600 for joint filers.
By passing the Universal Giving Pandemic Response and Recovery Act (UGPRRA), Congress can build upon this support and do more to make giving incentives fair for all taxpayers and to strengthen and expand this incentive. This will help charitable organizations achieve their missions and support their workforces and communities as our nation recovers from the current and future crises. As a member of the Charitable Giving Coalition, Goodwill Industries International applauds the introduction of UGPRRA by a bipartisan, bicameral group of lawmakers.
The bill would increase the cap on the temporary universal charitable deduction from $300/$600 to one-third of the standard deduction, roughly $4,000 for individuals and $8,000 for joint filers. It would also extend the availability of the deduction through 2022, and it would eliminate the exclusion of gifts to donor-advised funds from the current deduction.
While we recognize there are a number of reasons Americans donate to charity in times of great need, we do know an expanded charitable deduction can be one of those reasons. Goodwill Industries and the Charitable Giving Coalition looks forward to working with Congress to advance an expanded and extended universal charitable deduction, which will ensure all taxpayers have an incentive to give to charity when it’s needed most.