Some nonprofit leaders worry that a higher-education overhaul floated by Democratic presidential contender Hillary Clinton would be paid for in part by narrowing the tax break for contributions to charity.
Ms. Clinton proposed paying for her education plan’s 10-year, $350-billion tab by limiting unspecified "tax expenditures for high-income taxpayers."
Nonprofit leaders fear that signals a return to the same approach tried by President Obama, who repeatedly but unsuccessfully sought to limit the value of all itemized deductions, including the charitable deduction, to 28 percent for individuals earning more than $200,000 and couples earning more than $250,000. The current limit on the value of the deduction is 35 percent.
In July, the Charitable Giving Coalition, a group of 44 nonprofits, said it would press every declared presidential candidate to maintain the charitable deduction. Capping it, they say, would reduce charitable giving.
"We are disappointed that Secretary Clinton has instead chosen to frame her response to one problem with a proposal that will cut a lifeline to those most in need," said Joanne Florino, senior vice president for public policy at the Philanthropy Roundtable, an organization that represents donors, largely those with conservative views. "We urge her to reconsider her plan and protect the full scope and value of the charitable deduction."
Andrew Watt, president of the Association of Fundraising Professionals, echoed Ms. Florino’s concerns in a statement issued today.
Mr. Watt said that while the overall goal of the plan was "laudable," he was "concerned with the proposed funding mechanism that effectively diverts money away from charitable causes."
Ms. Clinton’s "New College Compact," proposed Monday, would increase federal support for higher education, enable students to refinance loans at more favorable rates, and provide free community college to all students.
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