While academics and politicians debate what impact a change in the charitable deduction might have on giving, a newly released study provides fresh information on the issue from the perspective of health care fundraisers.
In February 2011, the Association for Healthcare Philanthropy (AHP) surveyed its U.S. members to gauge the implications for health care giving if proposed changes to the tax code are implemented.
As you may recall, President Obama’s budget seeks to cap charitable deductions at 28 percent, while the Bowles-Simpson (The National Commission on Fiscal Responsibility and Reform) proposal would reduce the tax incentive for charitable giving to a 12 percent tax credit for donations that exceed two percent of a taxpayer’s adjusted gross income.
AHP was established in 1967 and is a not-for-profit organization whose more than 4,700 members direct philanthropic programs in 2,000 of North America's not-for-profit health care providers. In polling their members, the organization found:
90% of respondents believe that the proposed tax code change, if enacted, will reduce overall giving to their organization;
92% indicate that the proposed tax change will cause a significant reduction in major gifts to their organizations.
The survey, which can be viewed in its entirety here and their press release here, also found that 91 percent of their members who participated in the survey believe that tax deductibility is important to donors and that 74 percent believe that tax deductibility is very important to their major gift donors. As such, 61 percent of the AHP respondents anticipate lowering their fundraising projections if the proposed changes to the tax code are implemented.
William C. McGinly, president and CEO of AHP, summarizes: “Combined with growing state and federal cuts in funding for social services and uncertainty over implementation of the Patient Protection Act, these draconian tax proposals—if enacted—add up to a triple threat to America’s not-for-profit health care providers. This is not the path to take as we recover from the recession.”