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LIFT for Charities Act Has Clear Path To Approval

Legislation that will protect churches and other nonprofit organizations from having to pay taxes on some employee benefits will become law if a bipartisan appropriations package is approved by Congress as expected this week.  

The Lessening Impediments from Taxes (LIFTfor Charities Act introduced by Sen. James Lankford (R-OK) and Sen. Chris Coons (D-DE) in February repeals a section of the 2017 tax reform bill that requires some tax-exempt organizations to pay federal taxes on benefits like parking, meals and transportation costs like transit passes. 

“I believe that we have a moral obligation to support our neighbors most in need, and nonprofits play an essential role in doing just that,” Sen. Coons said in a statement. “The passage of this bill will help to ensure that America’s charitable nonprofits and houses of worship are able to continue providing critical services to communities without undue burden.” 

In November 2018, Lankford and Coons sent a letter to Secretary of the Treasury Steven Mnuchin expressing their concerns about the challenges faced by tax-exempt organizations regarding compliance with the new tax requirements and urging the department and the Internal Revenue Service to delay their enactment.  

Lankford said that most nonprofits were ill-equipped to handle the additional administrative burden and compliance costs caused by the tax requirement.  

The fix included in this week’s appropriations bill is a huge win for our nation’s churches, charities, and other nonprofits who are dedicated to serving our neighbors and meeting the needs of our communities. We should protect our nonprofits, not tax them, he said. 

In November 2017, Lankford introduced the Universal Charitable Giving Actwhich would create a universal charitable deduction in addition to the standard deduction, in the Senate, and Rep. Mark Walker (R-NC) introduced a companion bill in the house. The Act calls for allowing a deduction of up to $4,000 for individuals and $8,000 for married couples who donate to charity but do not itemize. 

Under current law, only taxpayers who itemize their deductions can deduct charitable donations. 

This year, Rep. Walker reintroduced the legislation on “Giving Tuesday, a charitable donation day that’s observed each year on the first Tuesday after Thanksgiving, per The Hill 

Lankford and Coons were the honorary co-chairs of this year’s National Prayer Breakfast, and both participate in the weekly Senate Prayer Breakfast. Writing about the prayer breakfast in a February Fox News post, they said, Praying together doesn’t solve everything, but as we’ve often said, it is much harder to throw a rhetorical punch at someone on the Senate floor when you’ve held hands in prayer that morning. 

Anne Stych

Anne Stych is a writer in Charlotte, North Carolina.