Course blog for American University PERF-570, Fall 2014
With our recent discussions about coalitions, I thought it appropriate to reflect on the start of my Internship with Dance/USA in the Government Affairs office this past week. One of the first meetings I attended with my supervisor was at Independent Sector: a leadership network for nonprofits, foundations, and corporations committed to advancing the common good. Sector leaders convene to work together on key issues affecting their respective fields (Coalition!). At this meeting, recent legislation on charitable tax incentives was discussed. To be honest, a key issue I struggle to articulate. So as all the information settles I continue to seek out resources to help me better understand charitable tax incentives.
This article sheds some light on some of the current chatter of charitable tax incentives. As most arts organizations are nonprofits, we as arts managers are part of the table discussion of policies. Among other nonprofits, tax incentives have the power to direct donor preferences from cultural institutions for instance towards health institutions, presumably more pressing needs of the nation and world. One of the suggestions in this article is to move from a deduction system to a credit system. Tax deductions are a) dependent on how the federal government sets marginal tax rates and b) unequal across donors based on their tax brackets. Tax credit can a) set the rates independently of marginal tax rates and b) all taxpayers can receive the same rate of effective subsidy. As an organization that relies on contributed income, tax incentives could gravely effect donor bases. Can we create a system that is less coercive of donors?