In his just submitted proposed budget for 2014 (on P. 36), President Obama ignored the plea of nonprofits to preserve the current level of deductibility for charitable donations, sticking to his plan for a 28% limit on the combined financial benefit to taxpayers from charitable donations and mortgage deductions. The current limit is 39.6%.
Here’s an example to illustrate what this means: Under current law, if you donate $100 and are in the top tax bracket, your deduction of $100 from your taxable income could be worth a maximum of $39.60 in saved taxes. Under President Obama’s 28% limit, the value of the $100 deduction would be reduced from $39.60 to $28 or a decrease of almost 30% in the size of the benefit to you.
So where do the Republicans stand on the charitable deduction? As it says on this FAQ page for the Republicans’ proposals, “The House Republican budget doesn’t address tax deductions. The Ways and Means Committee will ultimately make that decision. It will continue an open dialogue that this committee began last year.”
As CultureGrrl readers may remember, Mitt Romney, during the the Presidential campaign, suggested a far more drastic curtailment for the charitable deductions: a $25,000 cap on all tax deductions and credits.
Also of interest to art-lings:
—The Obama budget includes $869 million for the Smithsonian Institution, an increase of $59 million from the $810 million appropriation for FY 2012. For the current fiscal year, the Smithsonian has operated on a continuing resolution at the same level as the 2012 budget (as have all Federal entities), less $41 million due to sequestration. However, the Smithsonian was granted two additions this year: $5 million for the National Museum of African American History and Culture (to open in 2015); $2 million for roof repairs after Hurricane Sandy. Some $21 million in next year’s proposed budget is for planning, designing and fabricating the inaugural exhibitions and educational programs for the African American museum.
—The Obama budget includes $225,812,538—an increase of 2.7 percent, from fiscal 2013 post-sequester amount—for the Institute of Museum and Library Services (IMLS). Included in the proposed IMLS budget is a 12.58% increase for Museum Programs (as shown on this chart.)
—The Obama budget includes $154.5 million for the National Endowment for the Arts, an increase of $14.8 million from NEA’s post-sequester budget for fiscal 2013 of $139.7 million.
—UPDATE: The Obama budget includes $154.5 million for the National Endowment for the Humanities, compared to its post-sequester budget for fiscal 2013 of $138.38 million.