Federal Tax Reform Proposals Would Devastate
Connecticut’s Community-based Nonprofits

Contact: Patty McQueen 860-985-3533

(Hartford, CT) — CT Community Nonprofit Alliance has significant concerns about the impact of proposed changes in the federal tax code, now under consideration in the U.S. House and Senate, Alliance President & CEO Gian-Carl Casa said today.

Specifically, the proposals would change long-time tax policies that have helped support charitable nonprofits through tax incentives, while providing relief for middle-class earners:

  • Although the bills nominally retain existing deductions for charitable donations, both House and Senate versions make changes to the standard deductions that would drastically reduce the number of people who will itemize. With the tax benefit of charitable giving no longer available to 95 percent of taxpayers, nonprofits in Connecticut and across the country believe that private donations will plummet and their work in communities will suffer.

  • The House legislation includes language to nullify the Johnson Amendment, that for 60+ years has protected nonprofits with 501(c)(3) tax status from demands by candidates for public office and their operatives for endorsements, contributions, and other support. Nonprofits believe, and a congressional agency confirms, that the change would result in billions of dollars of dark money being diverted to newly political charitable organizations because the donors could now receive a charitable tax deduction.
    “The impact of these proposed changes, coupled with overall reductions in state and federal funding that will likely result from adding $1.5 trillion to the federal deficit, would devastate nonprofits,” Casa said.
    Casa added, “On behalf of the half-million Connecticut residents who rely on the vital services provided by community nonprofits every day, we urge the House and Senate to reject these provisions.”