Major Charitable Federations Oppose Proposed State Cap on Charitable Contributions

ALBANY, NY (06/25/2010)(readMedia)-- The New York State Catholic Conference, United Jewish Appeal-Federation of Jewish Philanthropies and United Way of New York State are urging state leaders to oppose a new proposal to limit the deductibility of charitable contributions in order to balance the state budget.

The proposal would result in a 50% decrease in the deductibility of charitable gifts from higher income donors.

Already, earners of $1 million or more can only claim 50% of their contribution as a deduction. This proposal would allow donors to claim just 25% of their contribution.

We appreciate the urgency of coming to closure on the budget this weekend and of the need to address the state's deficit.

However, charitable agencies are already struggling to serve New Yorkers given the downturn in the economy, the decline in charitable giving, government funding cuts, and lengthy delays in state action on contracts and payments. This is in addition to a steep increase in the demand for services.

Susan Hager, President of United Way of New York State said, "It is unconscionable that at a time when government funding is being reduced for most human services programs, NYS would consider a proposal that could jeopardize philanthropic giving at any level."

Richard E. Barnes, Executive Director of the New York State Catholic Conference said, "While on the surface this may seem like an attractive idea to raise revenue, the reality is it is exactly the wrong approach. The tax penalty in this case is not being felt so much by the wealthy taxpayer, but by the charities that are the beneficiaries of his or her philanthropy."

Ronald Soloway, Managing Director of Government Relations, UJA-Federation of New York said, "Government has asked those with means to increase their contributions to charity to help make up for funds that government can no longer afford to provide to help the poor and vulnerable. This proposal makes it ever more difficult for individuals of means to respond to government's clarion call to step forward and assist those in need."

The three organizations urge state policymakers to reject this proposal.