Nonprofits in the Trump Administration

nonprofitVarious articles from the Nonprofit Times and Chronicle of Philanthropy have recently been published about nonprofits under the Trump administration.  With the new 45th president taking office in two days, there will be changes. No matter your political bent, we should be informed and start preparing for how a new administration may affect the nonprofit sector. In this post, we lay out some of Trump’s high priorities and what it means for organizations.

Tax reform

Issue # 1 – There is a proposal to increase the standard deduction. This means that this will “…[reduce] the number of individuals able to file itemized tax returns.” The impact could “…decrease charitable giving because it reduces the number of itemizers, but there are also assumptions that – with an improved economy – giving would go up…” (Segedin).

Issue # 2 – Another proposal is to reduce the tax break for charitable contributions. Currently, it is at 39.6% rate and could potentially be reduced to 33% and limit the tax credit deductions to $200,000 per couple.  (Clolery and Hrywna).

IRS overhaul

There has been continued conversation about improving transparency. This has come from media covering and reporting the various issues with certain nonprofits misappropriating funds or tainted donations. About a year ago, there was proposed federal regulation that nonprofits would need to collect and report major donor contributions. However, it was withdrawn. Now, it could potentially be brought up again by General Kamala Harris (who recently won the California’s Senate seat and was the person spearheading appeals for the “Donee Report”).  Robert Waldman, attorney and Business Division Chair of Venable, LLP, advice is to make sure operations are in order (Clolery and Hrywna).

Cuts in Federal Funding

Overall, there is a concern that cuts in federal funding will impact social services. One particular funding source, Social Service Block Grant, might be cut or even eliminated. Currently, the grant is $1.5 billion. Reduction of this grant would affect programs that support children, mental health, and aging populations.

Clolery, Paul and Mark Hrywna. “Budget Cuts Might Hit Less Obvious Social Services.” The Nonprofit Times, 1 January 2017.

Segedin, Andy. “Nonprofits And President Trump’s First 100 Days.” The Nonprofit Times, 3 January 2017, Accessed 16 January 2017.

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