Tax Law Changes Affect Non-Profits
Federal: Tax Law Changes Affect Non-profit Organizations
Urge Your Senator to Support Arts-Friendly Revisions
Wrapped up in the massive pension reform bill finally enacted by Congress this summer are several provisions that would affect arts-related charities and donors. Unfortunately, the new law does NOT include a provision that would allow artists and creators to take a fair-market value tax deduction for works that they donate to arts and education institutions. It DOES include a “reform” provision that would discourage gifts to museums. Finally, and more positively, it also includes a provision that would allow older donors to more easily donate retirement funds to charities. With the enactment of the pension bill, our next chance to include the artist provision, and to repeal or alter the reform provision, comes with the next tax bills that the Congress might take up after the November 7 elections. To ask your Senator to support the artist provision and alter or repeal the “reform” provision -- please enter your zipcode in one of the designated boxes and click "go."
When artists give their own works away, they can write off only the cost of materials, such as paint and canvas, not the actual value of the work. Collectors, however, can deduct the fair market value. A bipartisan group of House members and Senators favor a provision that would end this inequitable treatment and would have the added positive effect of building collections for public use. The provision is important because most museums, libraries, and archives have limited acquisition funds; the only way to acquire new works is through donations. Living artists have little incentive to give their works to a nonprofit institution; instead, works of local, regional, and national significance are sold into private hands and may never come into the public domain.
The harmful “reform” provision will put a gigantic constriction on donors’ ability to stretch gifts out over time. This ability is important, because donors of important art works often run up against a cap on annual charitable deductions. The new provision both puts a strict time limit on such “partial” gifts and forces donors to use the lowest possible appraisal value in calculating their deduction. Needless to say, it will discourage gifts to museums and other collecting institutions, perhaps drastically. Therefore, we urge that it be repealed at the first opportunity.
The brightest spot in the pension bill is a provision allowing individuals aged 70-1/2 to roll funds from their retirement accounts to charities without first taking them as taxable income. The provision has been long-sought by the charitable community. Unfortunately, the measure that was enacted is temporary, expiring at the end of 2007. We have prepared a message for you to send to your Senators. Simply enter your zipcode in the designated box and click "go." http://capwiz.com/artsusa/issues/alert/?alertid=8258876&type=CO&azip=43081&bzip=0&show_alert=1
This information is provided for your interest. Does not necessarily reflect the views of Gallery202, Partners in Art, Inc. or it's governing board.
Urge Your Senator to Support Arts-Friendly Revisions
Wrapped up in the massive pension reform bill finally enacted by Congress this summer are several provisions that would affect arts-related charities and donors. Unfortunately, the new law does NOT include a provision that would allow artists and creators to take a fair-market value tax deduction for works that they donate to arts and education institutions. It DOES include a “reform” provision that would discourage gifts to museums. Finally, and more positively, it also includes a provision that would allow older donors to more easily donate retirement funds to charities. With the enactment of the pension bill, our next chance to include the artist provision, and to repeal or alter the reform provision, comes with the next tax bills that the Congress might take up after the November 7 elections. To ask your Senator to support the artist provision and alter or repeal the “reform” provision -- please enter your zipcode in one of the designated boxes and click "go."
When artists give their own works away, they can write off only the cost of materials, such as paint and canvas, not the actual value of the work. Collectors, however, can deduct the fair market value. A bipartisan group of House members and Senators favor a provision that would end this inequitable treatment and would have the added positive effect of building collections for public use. The provision is important because most museums, libraries, and archives have limited acquisition funds; the only way to acquire new works is through donations. Living artists have little incentive to give their works to a nonprofit institution; instead, works of local, regional, and national significance are sold into private hands and may never come into the public domain.
The harmful “reform” provision will put a gigantic constriction on donors’ ability to stretch gifts out over time. This ability is important, because donors of important art works often run up against a cap on annual charitable deductions. The new provision both puts a strict time limit on such “partial” gifts and forces donors to use the lowest possible appraisal value in calculating their deduction. Needless to say, it will discourage gifts to museums and other collecting institutions, perhaps drastically. Therefore, we urge that it be repealed at the first opportunity.
The brightest spot in the pension bill is a provision allowing individuals aged 70-1/2 to roll funds from their retirement accounts to charities without first taking them as taxable income. The provision has been long-sought by the charitable community. Unfortunately, the measure that was enacted is temporary, expiring at the end of 2007. We have prepared a message for you to send to your Senators. Simply enter your zipcode in the designated box and click "go." http://capwiz.com/artsusa/issues/alert/?alertid=8258876&type=CO&azip=43081&bzip=0&show_alert=1
This information is provided for your interest. Does not necessarily reflect the views of Gallery202, Partners in Art, Inc. or it's governing board.
posted by Gallery 202 at
8:35 PM
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