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Fiscal Cliff Not Averted, Simply Postponed!
Continued Action from Oregon Nonprofits is Necessary!
The Fiscal Cliff has only been temporarily averted with the passage of the "American Taxpayer Relief Act of 2012 (ATRA)." There is still much work yet to be completed. Contentious meetings are expected over the next three months as the President, Senate, and House address the federal debt ceiling (slated for February), the postponed sequestration (slated for March 1), and expiration of the stop-gap federal spending bill for the current fiscal year known as the Continuing Resolution (slated for March 27).
The Nonprofit Association of Oregon (NAO) joins the National Council of Nonprofits (the nation’s largest network of nonprofits) with mixed views of ATRA. While we are glad that Congress was able to pass a compromise bill, we have grave concern about the inability of federal policymakers to resolve the debt crisis. We are especially concerned as there are still pending across-the-board cuts of $54.6 billion from domestic spending programs that will increase demands for services, and reduce resources to meet those growing needs. Programs scheduled for cuts include block-grants and contracts to nonprofits supporting after school services, transportation safety, senior care, homeless shelters, and our most vulnerable citizens.
In addition, NAO continues to advocate against any cap to the charitable giving incentive. The ATRA legislation passed on Tuesday limits how much the nation’s top earners can claim in deductions for charitable contributions and other spending when they itemize their tax returns. The law restores the Clinton-era Pease provision that reduces itemized deductions by 3% of the amount that household income exceeds $300,000. According to the Tax Policy Center, charitable deductions grow more limited the more taxable income a person has. This has the effect of reducing the total value of deductions by as much as 80% for the highest-income taxpayers. This cap on charitable giving disproportionally punishes Oregon philanthropists and the charities they support, as Oregonians traditionally give to charities at higher than average national rates (see OCF Giving in Oregon Report).
As negotiations continue over the next three months on the now-postponed sequestration cuts and on the debt ceiling, we encourage Congress and the President to continue to recognize how essential the services of the nonprofit sector are in communities across the country, and particularly here in Oregon. We also remind the President and Congress that incentives for charitable giving are vital to the health of the sector and the ability of nonprofits to perform in our communities.
NAO is calling on the nonprofit sector in Oregon to keep up the pressure on Congress and the President to avert drastic cuts to vital services delivered through our sector and continue to protect the charitable giving incentive for all Americans, regardless of tax bracket. We encourage you to get in contact with your representatives and help make our collective voice heard!
The Nonprofit Association of Oregon (NAO) is the only statewide organization that works to build the collective voice, capacity and organizational effectiveness of Oregon’s nonprofit sector. NAO keeps members informed about critical policy issues affecting nonprofits and ensures that our collective voice is heard. Members gain access to a wide range of benefits including: advocacy efforts, discounts on products and services, NAO trainings, networking opportunities, and much more. Please support our work through your membership!
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