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U.S. House Legislation Extends Charitable Giving Deductions

Feb 12, 2015
Press Release

WASHINGTON, D.C. – Today the U.S. House of Representatives passed legislation to expand tax deductions for charitable giving to food banks and other causes. The America Gives More Act, supported by Congressman Kevin Cramer, extends and expands the charitable deduction for food banks, allows certain tax-free donations from IRAs, and simplifies taxes on private foundations.

“Our tax code should stand firmly on the side of those who give to their neighbors and communities, whether they are writing a check or keeping a food bank stocked. This legislation clarifies tax rules for charitable contributions and makes several key deductions permanent. Charity replaces the need for many government services and is much more effective than bureaucracy,” said Cramer.

The legislation makes a rule allowing individuals to make tax-free donations from their IRAs permanent. In the first two years after the temporary provision was enacted, it prompted an estimated $140 million in additional donations.

It also permanently expands a deduction for the donation of goods including food, making the provision apply to any type of business. Finally, it lowers and simplifies the excise tax on private foundation investment income from 2 percent to 1 percent. The tax is often frustrating for small foundations which can have endowments fluctuate greatly from year to year.