New IRS Rules on Charitable Deductions Make Philanthropy More Difficult

The following is from Samuel L. Braunstein and Carol F. Burger, The IRS Gets Less Charitable, Dec. 2007:

Generosity is a noble trait shared by many Americans. Traditionally, this generosity has been rewarded with favorable tax treatment by the Internal Revenue Code and Internal Revenue Service regulations, primarily in the form of deductions pegged to qualifying charitable contributions of cash or property.

But the federal tax laws are getting stingy in their treatment of charitable donations***

A number of restrictions on deductions for charitable donations are contained in the Pension Protection Act of 2006.****

Taxpayers who seek deductions for their contributions to charities aren’t the only ones dealing with tougher tax guidelines. Charities themselves also must navigate through that more complex tax environment.***

Few if any charitable organizations are likely to abandon their missions under the growing burden of government regulations, nor should they expect to lose the support of donors. At the same time, their task sure isn’t getting any easier.