Skip to content

Why Take Away America’s Incentive to Give? | Commentary

As lawmakers take on the gargantuan task of reforming our tax code, teams of lobbyists have already begun to line up to defend tax credits and exemptions that support special interests. There is one group of Americans, however, who do not have access to lobbyists and lawyers. They are the 1 in 5 American children who currently live below the poverty line. And a vital source of support for them may be in serious jeopardy.

In recent reports from the Senate Finance Committee and the Joint Committee on Taxation, policymakers outlined several proposals for reforming the popular charitable-giving tax exemption, which has been a part of the U.S. tax code since 1917. Among them were proposals to cap itemized deductions, convert the charitable deduction into a tax credit and impose a threshold for charitable contributions.

All of these proposals share one thing in common. They all could lead to significant reductions in charitable giving to nonprofit human-serving organizations that provide vital services and support for low-income families at a time when the need is significant and our opportunity to help them succeed is crucial.

According to research from the Urban-Brookings Tax Policy Center, President Barack Obama’s budget proposal on charitable deductions could result in as much as $9 billion in lost charitable donations.

That is why the Alliance for Children and Families, composed of hundreds of organizations in a network that serves 4.6 million individuals annually, has joined with other nonprofit organizations to speak out. Along with 60 nonprofits, foundations and charitable organizations, including the American Red Cross, the Giving USA Foundation, United Way Worldwide and Volunteers of America, we are encouraging Americans to join us in urging lawmakers and the federal government to protect the charitable-giving deduction.

Collectively, organizations that represent human services receive a mere 2 percent of annual charitable giving, which will have little impact on the federal government’s need to increase tax revenue. The loss of those charitable dollars, however, will have a disproportionate impact on the low-income families and communities we serve, particularly at a time when government-funded supports for vulnerable populations have significantly diminished and continue to decline.

In fact, a recent report from The Philanthropic Collaborative found that for every dollar donated via the charitable deduction, communities see $3 in benefits through increased jobs, higher wages, gross domestic product and tax revenues. And that doesn’t take into account the increased revenue from families who are able to move out of poverty with the support of human services, thus reducing their reliance on welfare and other government subsidy programs.

With dwindling government support for social services, organizations like ours are helping to fill the gap, engaging volunteers and communities in providing important resources for families in jeopardy.

Grounded in thousands of communities across the nation, the Alliance network does more than provide programs and services — it engages people where they live and work and builds the capacity of communities to lift people out of poverty and produce transformative changes that help create healthier families and neighborhoods. We give families a hand up, not a hand out, and make them partners in their own success, be it achieving improved physical and mental health, better education levels or employment outcomes that allow them to live their lives with independence.

Lawmakers’ increased attention on reigning in spending and getting our fiscal house in order is both laudable and necessary. However, during government contraction and tough economic times for families, we should be making it easier, not harder, for Americans to help their neighbors.

America has always rallied together when times are tough, whether in the face of economic difficulties, natural disasters or terrorism — and the U.S. government is a critical support for such efforts. Let’s not change that now by unraveling this vital tax incentive, which plays such an important role in supporting the crucial work of the nonprofit human services sector.

Susan N. Dreyfus is the president and CEO of the Alliance for Children and Families and Families International. She is the former secretary of the Washington State Department of Social and Health Services.

Recent Stories

Rep. Suzan DelBene will continue as DCCC chair for 2026

Seniority shakeup? House Democrats test committee norms

Republicans sink attempts to force release of Gaetz report

DOGE day afternoon on Capitol Hill

House task force finishes work on Trump assassination attempt

Hegseth soldiers on with meeting GOP senators