Evangelical Agency Says New Tax Plan Will Help Christian Charities
An evangelical accreditation agency has heralded the recently passed tax bill as good news for church donors and Christian nonprofits.
According to Evangelical Council for Financial Accountability President Dan Busby, the new tax package negotiated by U.S. President Barack Obama provides the public some certainty and will likely encourage charitable giving. It also holds favorable estate tax provisions which would allow donors to give generously to the ministry of their choice after death.
"The adoption of a 35 percent estate tax instead of a tax at a higher rate is a boon for Christ-centered churches and organizations," said Busby. "This will permit faithful stewards whose hearts are rich toward God to be even more generous in their giving and will result in multiplied millions of dollars being used to carry out the Great Commission."
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Obama signed the tax legislation into law on Friday. The legislation attempts to help unemployed workers by extending unemployment benefits for another year. It reduces Social Security payroll taxes by 2 percent for workers earning $106,800 or less, saving those with incomes of $40,000, for example, nearly $1,700. The legislation also extends a number of tax credits including those for children, college enrollment and earned income.
Also, the scheduled rise in estate taxes has been lowered from 45 percent to 35 percent.
Critics on the right say the package will add $858 billion to the national debt over the next two years. The left criticized the compromise because they say it will extend Bush-era tax cuts for the wealthy.
Still, Busby says the plan is an economic pick-me up for the faith-based charitable organizations.
According to a November study conducted by International aid group World Vision, 51 percent of Americans are already contemplating giving more to charity this Christmas season. ECFA believes the tax plan will encourage giving well into 2011.
According to the ECFA, tax-free charitable distributions up to $100,000 per tax year from Individual Retirement Accounts (IRA) have been extended retroactively from January 1, 2010, through December 31, 2011. The extension, it states, may be helpful for givers age 70 and older.
Lowered estate taxes will also allow couples to pass estates as large as $10-million to organizations tax-free. Individuals could pass on the first $5-million tax-free.
ECFA was founded in 1979 and provides accreditation to leading Christian nonprofit organizations that faithfully demonstrate compliance with its standards of financial accountability, fundraising and board governance.
