In February 2014 David Camp (R-Mich; former chairman of the House Ways and Means Committee) authored a bill regarding tax policy changes for nonprofits. Proposed changes included executive compensation caps, tighter limits around charitable tax deductions, and mandatory five-year payouts of donor-advised funds.
For the past year the bill has circulated for comments (mainly around donor-advised funds) and with Congress back in session, some of these changes could find their way into law this year. While it is unlikely that a broad tax overhaul will happen, the Obama administration and members of Congress have expressed interest around business-related tax changes (indicating that provisions around charitable deductions will likely not be on the table). That said, guidance around precise topics has not been specified; as such, members of the House Ways and Means committee are in the process of determining what can be included in a business-reform plan.
In addition to Congress, the Senate Finance Committee has also established multiple panels to review possible changes to the tax code for nonprofits.
For more information and details from Harold Hancock, tax counsel for the House Ways and Means Committee, visit Philanthropy.com.
The information and materials herein are provided for general information purposes only and are not intended to constitute legal or other advice or opinions on any specific matters and are not intended to replace the advice of a qualified attorney, plan provider or other professional advisor. This information has been taken from sources believed to be reliable, but there is no guarantee as to its accuracy. In accordance with IRS Circular 230, this communication is not intended or written to be used, and cannot be used as or considered a ‘covered opinion’ or other written tax advice and should not be relied upon for any purpose other than its intended purpose