The Proposed Charitable Deduction Change
Differing views on whether a change will affect giving to churches.

The president has proposed a 2012 budget that will decrease the value of itemized tax deductions, including deductions for charitable contributions, for individuals making $200,000 or more and families making $250,000 or more per year. Also in the proposed budget is a tax increase for those in that income level.

Some say both of these changes could mean a decrease in the amount of charitable contributions to churches. Others suggest the affects may not amount to much.

In the 2011 State of the Plate, a survey of more than 1,500 church leaders, 91 percent say that this type of change would affect future giving at their church. Of the 91 percent, 31 percent characterize the potential damage as "significant."

Robert Sharpe Jr., writing a guest piece for The Chronicle of Philanthropy, challenged whether this is the right time to decrease itemized tax deductions when "the losses wealthy people suffered in the recession have already reduced the amount they can afford to give to charity."

A report by the Congressional Budget Office (CBO), though, gives a little hope that the effects on churches won't be significant: "[The CBO report shows that] most of the donations from the rich go to large institutions," writes Tobin Grant of the CT Politics blog. "This pattern stands in stark contrast to those with incomes less than $100,000. These individuals give two-thirds of their donations to religious groups."

The CBO also examined another possible change in the tax code that would allow all taxpayers to deduct contributions without itemizing. According to Grant, the CBO concludes that this would increase contributions to charities.

It's difficult to tell if the proposed tax changes will be passed (a recent Non Profit Quarterly editorial explains the difficulty of recent budget negotiations) and—if they do pass—how much it will influence the amount of charitable contributions to churches. In the meantime, churches should share their stories with their local communities to underscore the value of charitable contributions and the tax deductions designed to support them.

This content is designed to provide accurate and authoritative information in regard to the subject matter covered. It is published with the understanding that the publisher is not engaged in rendering legal, accounting, or other professional service. If legal advice or other expert assistance is required, the services of a competent professional person should be sought. "From a Declaration of Principles jointly adopted by a Committee of the American Bar Association and a Committee of Publishers and Associations


Displaying 1–1 of 1 comments


August 07, 2011  6:13pm

I find it disturbing that Christians who give or tithe are that concerned about losing or decreasing their tax deduction. If that is their concern, I think it's a matter of where their heart is. We would still tithe the same as always whether it was a tax deduction or not. I don't see anything in the bible stating that your tithes and offerings depend on whether or not they are tax deductible! This is truly sad.

Report Abuse
Recent Posts
Subscribe to Church, Law & Tax


Creating a Safety Team

Creating a Safety Team

Every church could benefit from having a safety team trained to respond appropriately to crises.
Reducing the Risk

Reducing the Risk

Keep your church safe from child sexual abuse.