Buchanan, Suozzi Introduce Bill to Promote Charitable Donations
WASHINGTON – U.S. Reps. Vern Buchanan (R-FL) and Tom Suozzi (D-NY) Thursday introduced bipartisan tax legislation to incentivize charitable giving throughout the United States.
“Everyday Americans are the foundation of charitable giving across the country,” Buchanan said. “This is a commonsense approach to help Americans give to their favorite charities by providing them with an effective tax break. Charities and non-profit groups throughout the U.S. serve some of the most vulnerable populations in our communities.”
“Americans across our nation are supporting not-for-profits, religious institutions, and hospitals that are tackling incredibly important issues such as combatting the opioid epidemic, fighting hunger, curing cancer, and much more,” Suozzi said. “That is why I am so proud to introduce this legislation with Rep. Buchanan which would incentivize even more Americans to bolster their favorite causes.”
Specifically, the Everyday Philanthropist Act (H.R.4002) would allow employees to set aside up to $2,700 per year, on a pre-tax basis, to give to the charity or charities of their choice through the establishment of Flexible Giving Accounts (FGAs). This new employee benefit, which employers will be able to administer themselves or enlist outside help to establish, would function similarly to flexible spending accounts (FSAs), health savings accounts (HSAs) and other pre-tax payroll deductions. While $2,700 is the annual cap, there would be no minimum contribution requirement, giving every American access to these tax-free accounts.
Last month, Giving USA reported that American households’ charitable donations in 2018 were at its lowest levels since the Great Recession. Despite a strong economy in 2018, individual charitable donations fell by more than $3.2 billion dollars -- a decrease of nearly 3.5% when adjusted for inflation.
This decrease is especially impactful as donations from individuals make up over two-thirds of all annual charitable giving. Without increased tax incentives, many charitable organizations expect the decline in donations to continue.
The Greater Give co-founder Dan Rashke applauded Buchanan and Suozzi, stating, “The Greater Give thanks Congressmen Buchanan and Suozzi for their leadership in introducing this bipartisan, commonsense legislation. By allowing employers to set up consumer-directed accounts for their employees, the Everyday Philanthropist Act will give those who do not itemize on their tax returns the opportunity to give to the charities of their choice on a pre-tax basis. We believe this will empower an increase in charitable donations from everyday Americans and strengthen our country’s philanthropic culture.”
Employers will have the option to administer FGAs themselves or enlist the assistance of employee benefits managers (such as payroll providers, HRIS platforms or third party administrators). In the latter case, donor information and donation delegation would be kept confidential much like with other consumer-directed accounts.
Buchanan is a senior member of the powerful U.S. House Ways and Means Committee, which has jurisdiction over tax policy.