U.S. Senators Build Momentum on Legislation to Strengthen the Universal Charitable Deduction

A bipartisan group of six U.S. Senators, led by Senator James Lankford (R-OK), continues to urge their Senate colleagues to increase the $300 cap on the temporary universal, above-the-line, charitable deduction included in the Coronavirus Aid, Relief, and Economic Security (CARES) Act. The group is planning to introduce legislation that would extend the cap to one-third of the standard deduction, about $4,000 for individuals and $8,000 for couples, and allow certain cash gifts made in 2020 to be deducted on 2019 tax filings. Senators Chris Coons (D-DE), Amy Klobuchar (D-MN), Mike Lee (R-UT), Jeanne Shaheen (D-NH), and Tim Scott (R-SC) have joined Sen. Lankford in championing the effort.

Enacted on March 27, the CARES Act included a modest, temporary universal charitable deduction allowing non-itemizing taxpayers to deduct up to $300 in cash gifts for 2020. Previously, only itemizing taxpayers, roughly 10% of taxpayers, could deduct charitable gifts. CASE has continued to work closely with the Charitable Giving Coalition and Senator Lankford’s office to strengthen this incentive that would encourage more giving to nonprofits, including U.S. colleges, universities, and independent schools, during the COVID-19 crisis.

Momentum on the issue increased in June. On June 2, the U.S. Joint Economic Committee held a hearing on "Supporting Charitable Giving during the COVID-19 Crisis." The discussion centered on the bipartisan group’s charitable giving proposal and included outside testimony from Bill Crim, President and CEO of United Way of Salt Lake, Utah, and Una Osili, Professor of Economics and Philanthropic Studies at Indiana University’s Lilly Family School of Philanthropy.

Leading up to the hearing, CASE joined other nonprofit organizations to sponsor a national webinar with the bipartisan group titled “From Common Ground to Congressional Action: Advancing the Universal Charitable Deduction." With philanthropic giving expected to decline in the wake of the COVID-19 health and economic crisis, the Senators said that it is critical for Congress to provide additional support to donors and charities so that they can continue to provide vital services to families, workers, and communities. More than 4,000 charity leaders registered for the webinar.

Though the Senate is not expected to consider the next COVID-19 stimulus package until next month, the Senators’ push for a strengthened universal charitable deduction is a positive step in ensuring that an enhanced giving incentive is included in the final bill.

While we work with our education and charitable sector partners to make the case for additional aid for educational institutions in coronavirus legislation, subscribe to the CASE Advocacy Network and visit our U.S. COVID-19 Response Legislation for the latest developments.