Obama’s Decision to Veto Tax Law Hurts Charity
An unprecedented move by the President to veto a move by Republicans to introduce three charitable tax laws has been considered as non-charitable this giving season!
Food for Hungry Families Sent to Landfill
It was with deepest regret that a lot of caring people read about the Michigan landfill debacle. A whopping 150 tons of Michigan apples that could have fed countless hungry families were dumped in a landfill. And it seems all because of President Obama. The outgoing Chairman Republican Dave Camp of the Draft Tax Law along with Senator Ron Wyden, an Oregon Democrat and a Michigan Republican made a last unpartisan effort to pass a law and make three temporary charitable tax provisions permanent.
According to tax attorneys, each of the three tax laws provides powerful options to the donors to make charitable contributions in terms cash, food, and environmental preservation. The first one of these provisions allows senior citizens in the 70.5 age group to make a charitable donation of $100,000 directly from their retirement savings without having to pay taxes on the withdrawal.
Another of these three tax provisions allow people with landholdings to donate privately held land to conservation easement. This is a very powerful tax tool as it allows the land owner to have an agreement with the government to preserve privately held land in its pristine state and not allow any kind of development, in return for tax exemptions.
The third tax provision allows restaurant owners, farmers, and others to donate food to the hungry and needy. Working together, these three taxes would create a channel for individuals, corporations, and small businesses to stand beside the homeless and poor in their community and help them.
Obama Declines to Support the Draft Tax Laws
Tax attorneys say, being temporary in nature, these laws tend to expire every year and need to be reinstated at the behest of concerned senators. As a result of this neither the donors who may be corporations and endowed individuals nor charitable concerns plan for these contributions and donations respectively as they are not sure if the tax law will be reinstated in the coming year.
Older citizens cannot make a lump sum IRS contribution without knowing in advance if the withdrawal would be taxable. Similarly, the conservation easement alliances and agreements often require years of planning and food donors in the absence of exemptions may find it cheaper to throw away food as happened with the Michigan landfill than donate it to charity.
The need for Permanency
This was the reason behind Senators Camp and Wyden’s initiative to make permanent these three outstanding tax laws. The path of the law making process was thought to be a smooth one as the charitable gifts brought forth by these laws had bipartisan support from both houses in Congress.
Buying Votes
The President however, thinks that the 10 year long cost of converting these laws would increase the national debt by $11 billion and has decided to veto the bill. This has nothing to do with taxes here but with the President’s own inability to cut spending. He does not believe in the private sector helping the poor in a more efficient manner, he wants more money so he can buy more votes and employ more federal bureaucrats.
