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Lankford Continues Push for Charitable Giving Deduction to Encourage Giving & Support Nonprofits

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WASHINGTON, DC – Senator James Lankford (R-OK) today showed his support for our important nonprofit community in Oklahoma, the nation, and around the world as he discussed the vital role they play in feeding, clothing, sheltering, and supporting the most vulnerable among us.

Lankford served as Ranking Member in today’s Senate Finance Committee hearing, entitled, “Examining Charitable Giving and Trends in the Nonprofit Sector,” to discuss the importance of incentivizing charitable giving in our tax code to ensure that all Americans are encouraged to share their hard-earned money with the nonprofit of their choice.

Last year, Lankford was joined by his colleagues to introduce his Universal Giving Pandemic Response and Recovery Act, which would expand and extend the non-itemizer deduction for charitable giving. Lankford’s bill is supported by numerous Oklahoma nonprofits and nonprofits from around the country.

Opening Remarks as Prepared

Thank you, Mr. Chairman. I am so glad that we are having this hearing to discuss the health of our nonprofit sector and how we can support and encourage giving through our tax code. This is an issue near and dear to me—on a personal level and a policy level—and I’m encouraged to be having this discussion today. 

First, let me start with a big thank you – thank you to our inspiring nonprofit sector – our safety net in times of need. We have a few safety nets in our nation – first the family, then the community, and last on that list is the government.

Nonprofits are the best example of our community safety net—rising to the occasion to come alongside our struggling neighbors, brothers, and sisters. They know the needs of the community, what makes it unique, what it values, how best it can be served. And that’s exactly what they did during COVID-19—our charities and nonprofits rose to the occasion to serve countless Americans facing uncertainty and difficulty across the country.

But they weren’t immune from the impacts of the pandemic—its impact on their workforces, their operations, their organizations.

According to the Johns Hopkins Center for Civil Society Studies 2020 Nonprofit Employment Report, during the first three months of the pandemic (from March through May of 2020), the nonprofit sector lost an estimated 1.6 million jobs—reducing the nonprofit sector by over 13 percent.

As of the end of last year, the sector was still down nearly half a million jobs (468,116 jobs), and for certain portions of the nonprofit sector, it’s estimated to take up to 20 months beyond January of 2022 to recover those pre-pandemic jobs.

We know that encouraging more Americans to give will help direct additional resources to nonprofits to ensure they can continue to provide vital services to our communities.

In 2020, in the CARES Act, we included a provision to allow taxpayers to take a deduction of up to $300 for charitable gifts that they make. Then, in December of 2020, we extended that provision, so that taxpayers could deduct $300 ($600 for joint filers) for gifts given in 2021. Unfortunately, this provision expired at the end of last year.

This provision—a non-itemizer charitable deduction—acts as both a lifeline to our nonprofit sector, who felt the impacts of COVID-19 while also answering the call to serve, and as an incentive for everyday Americans to give what they’re able.

Now, we’re again reminded how crucial these organizations are—both in local communities and internationally – as we see our nonprofit community respond to the devastating crisis in Ukraine and support Ukrainian citizens with care, housing, and food. Having the charitable deduction in place can incentivize even more giving at critical times like these.

This provision is something that I am very passionate about and have worked on over the last several years with a great group of partners through introduction of the Universal Giving Pandemic Response and Recovery Act last year.

I look forward to discussing the non-itemizer charitable deduction today and how it encouraged giving over the last two years. I’m hopeful we can renew this important incentive soon. I’m also looking forward to hearing additional ideas from the witnesses and my colleagues regarding ways that we can encourage giving and support our nonprofits. 

This hearing comes at a pivotal time. 2020 was a record year for charitable giving, with a significant increase in small gifts, but we’ve seen varying trends in household giving for the last several decades. It is vitally important that we encourage and incentivize all Americans to give—it  speaks to who we are as a people and as a nation.

We have an expert panel of witnesses in front of us today, who can speak to the health of the sector, the work on the ground, the ways and reasons Americans give, how much they give, and how we can encourage more of that giving going forward. I thank you all for your steadfast dedication to your work and welcome your testimony today.