New Bill For Non-Itemizer Charitable Deduction

Legislators on Capitol Hill recently rebooted a bill to bring back a universal charitable deduction. ECFA supports this bipartisan legislation that would honor and incentivize giving by Americans of all income levels.

The Charitable Act authored by Sens. James Lankford (R-Okla.) and Chris Coons (D-Del.) is very similar to legislation those senators sponsored in the last session of Congress — the Universal Giving Pandemic Response and Recovery Act. Like its predecessor, the Charitable Act would allow non-itemizing taxpayers to claim a deduction worth up to one-third the standard deduction — roughly $4,600 for individuals or $9,200 for joint filers in 2023.

“Our nonprofits provide our neighborhoods and families vital job training, compassionate homeless assistance, food in times of crisis, and spiritual counsel during our best and worst days,” said Lankford. “As Oklahomans and Americans donate their time, money, and resources to our nation’s nonprofits so they can serve people, they should be able to deduct more from their federal taxes as an incentive to financially support nonprofits since these services are often in place of government benefits.”

The Charitable Act would build on a successful pandemic-era experiment that had allowed a $300 above-the-line benefit for donations ($600 for married couples filing jointly). That small step helped fuel much-needed increases in giving in 2020 and 2021. Indeed, should anyone doubt the power of the tax code to influence charitable giving, Lankford noted in a Senate Finance Committee hearing last year a demonstrable correlation between the $300 non-itemizer deduction and the major increase in precisely $300 donations on December 31, 2020.

Sadly, Congress allowed that important provision to expire at the end of 2021. And while the traditional charitable deduction remains a powerful giving incentive, it is unfortunately restricted to generally wealthier taxpayers who itemize their deductions — only about 12 percent of those filing. The Charitable Act would again democratize this incentive, reinforce habits of giving, and recognize the sacrificial hearts of many individual donors that ECFA ministries depend on to continue their work.

“People of all means gave freely to charities, houses of worship, and other nonprofits… to the tune of $449 billion last year,” noted Coons. “I am proud to have worked on the Charitable Act that will expand and extend the deductions Americans can claim to encourage even more Americans to embrace the civic virtue of charitable giving."

ECFA is working with other nonprofit leaders in the Charitable Giving Coalition (CGC) to support this legislation. We participated in a Capitol Hill advocacy day in November and again joined a CGC letter affirming our support for the Lankford-Coons bill.

“From national disasters to social problems to economic hardship, America is facing unprecedented challenges that nonprofit services can help to address,” the coalition wrote. “Congress can help the sector serve communities by restoring and expanding the universal charitable deduction, which encourages all Americans, regardless of income, to give to charity.”

ECFA will continue to monitor this effort closely. We are committed to urging congressional support for charitable giving incentives, particularly the successful universal charitable deduction.


This text is provided with the understanding that ECFA is not rendering legal, accounting, or other professional advice or service. Professional advice on specific issues should be sought from an accountant, lawyer, or other professional.