New legislation, recently introduced in the Senate, would create tax-free "personal philanthropy accounts" to encourage pre-tax charitable giving. S 3881, introduced by Senators Isakson (R - Georgia) and Lautenberg (D - New Jersey), would allow workers to contribute up to $15,000 to nonprofits annually by payroll deduction.
By making these deductions "pre-tax," it increases the employee's take-home pay (compared to making the donation after-tax) by reducing the amount on which taxes are calculated. This, of course, is should act as an incentive to charitable giving in the workplace.
It will probably be the next session of Congress that will actually vote on this, in both the Senate and the House, but depending on the wording of the final bill it could be a good giving incentive, and a vehicle for nonprofits to base their annual campaigns on.
I learned about S. 3881 from the 501 strategies Nonprofit Blog. We are each members of the Nonprofit Blog Exchange.
Tags: nonprofit, giving, taxes, deductions, legislation, Senate
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