Newspaper Page Text
PAGE 10 — The Georgia Bulletin, June 6, 1985
Reagan Tax Proposal
Private Charities Would
Lose
If Non - Itemizers Can't Deduct
HOOP STAR HONORED — Danny Ferry,
named national high school basketball player of
the year, meets President Reagan at the White
House. Ferry, whose father, Bob, is general
manager of the Washington Bullets, played at
DeMatha, a Catholic high school in the
Washington suburb of Hyattsville, Md. He will
attend Duke University. (NC Photo from UPI)
BY
LIZ S. ARMSTRONG
WASHINGTON (NC) —
In a move non-profit
charitable groups said will
cost them $5.2 billion,
President Reagan’s tax
reform plan would end a
tax deduction for
charitable contributions by
taxpayers who do not
itemize on their tax
returns.
The president’s “pro-
family” plan, officially
unveiled May 29, the day
after a nationally televised
speech by Reagan, also
does not include one of
Reagan’s oft-mentioned
tax goals: tuition tax
credits.
The White House said
May 29 that tuition tax
credits and tax reform are
two separate issues.
In his speech May 28
outlining his plan, Reagan
said his administration in
tends “to pass the
strongest pro-family in
itiative in post-war
Tuition Tax Credits Omitted,
Supporters Remain Optimistic
BY
STEPHENIE OVERMAN
WASHINGTON (NC) -
No mention of tuition tax
credits was made in Presi
dent Reagan’s tax reform
proposals, but supporters
of the credits said they
were optimistic about
chances for success.
Assistant Treasury Sec
retary Ronald Pearlman
May 29 told represen
tatives of various citizens’
groups, including tuition
tax credit supporters, that
Reagan did not mention
tuition tax credits in his
speech because it is still
pending legislation and the
new proposal deals only
with current law.
Pearlman told the group
that provisions have
already been made in the
president’s budget sent to
Congress earlier this year
to allow parents who send
their children to non-public
schools to receive a tax
credit for tuition. He said
the administration remains
committed to the concept.
After meeting with
Pearlman and White House
Chief of Staff Donald T.
Regan, the group was ad
dressed by Reagan and
Treasury Secretary James
A. Baker III. Reagan spoke
about the “pro-family”
aspects of his proposal and
the need to simplify the tax
system but did not mention
tuition tax credits in the
20-minute White House
speech.
In his re-election cam
paign Reagan had said that
tuition tax credits “are at
the top of my domestic
agenda.”
Father Thomas G.
Gallagher, U.S. Catholic
Conference secretary of
education, said after
attending the White House
meetings, “It is a fact that
it (tuition tax credit legisla
tion) is a high priority —
there’s no reason to doubt
that.”
Father Gallagher said he
believes it is “still a
possibility” that the
legislation will be passed
by Congress even though
other credits would be
eliminated by the tax
overhaul. “I’m an
optimist,” he said.
During Reagan’s ad
ministration the tuition tax
credit proposal has made it
only as far as the Senate
floor, where it was im
mediately tabled.
Robert L. Smith, ex
ecutive director of the
Council for American
Private Education, said he
also believes that a tax
credit bill could still pass.
But he said, “I really don’t
know how it might be got
ten into the fax discussion
this year, given the full
court press for tax
reform.”
Smith, who also attended
the White House meeting,
did see help for parents of
non-public school students
in Reagan’s tax reform
proposal. “It’s doubling the
family deduction and that’s
a significant kind of help to
families who are paying
• tuition,” he said, v.v.w
Another participant in
the meetings, Ursuline
Sister Renee Oliver, ex
ecutive director of Citizens
for Educational Freedom,
said she believes “the
president is sincere” in
wanting to help non-public
schools but “I think it
would be perceived as a
contradiction to say ‘get rid
of all these things clutter
ing up the tax code’ and
then put in tuition tax
credits.”
She said that “if any
credits are going to be
mentioned, this (tuition tax
credits) is one that belongs
there . . . Parents of non
public school students are
not un-American special-
interest groups.”
Sister Oliver said her
organization is going to put
more emphasis on state
and local governments in
seeking education vouch
ers and transportation for
non-public schoolchildren.
Only half the states have
laws that provide transpor
tation for non-public school
students, she said, and
even many of these “just
don’t get around to it.”
“I think the big thrust
has to be at state and local
levels,” she said. “But the
only way to get the state
and local level to move is to
get the blessing from the
federal government” that
would set the precedent.
She believes the chance
of getting that federal
blessing is not dead but “if
people \varit it they are go
ing to have to fight for it:’’•
history.”
Unlike an earlier Treas
ury Department draft pro
posal, the presidential tax
scheme would not demand
that itemizing taxpayers
give a specific percentage
of their income before
claiming a charitable
deduction. Under the
original Treasury pro
posal, the taxpayer could
only deduct the amount of
the charitable contribution
exceeding 2 percent of his
or her adjusted gross in
come.
Bishop James W.
Malone, president of the
U.S. Catholic Conference,
in April had urged Reagan
not to eliminate any ex
isting deductions for
charitable giving, saying
such proposals posed a
“very considerable threat
to private charity.”
Asked May 29 why tuition
tax credits were not part of
the tax proposal, Deputy
Press Secretary Larry
Speakes said, “The presi
dent certainly favors it.”
“That’s a separate
deal,” Speakes added.
“This is tax reform. It
doesn’t mean anything”
that tuition tax credits are
not included in the tax plan,
he said.
Repeal of the non-
itemizers’ charitable
deduction was criticized by
Independent Sector, a
coalition of non-profit
groups, which said that
dumping the non-itemizer
charity deduction will
mean a loss of $5.2 billion in
donations and, when cou
pled with other changes in
tax rates, force a $10 billion
cutback in service offered
by the charities.
Reagan, as a candidate
in 1980, had told Catholic
Charities officials he back
ed the charitable deduction
for all taxpayers, “whether
they itemize or not,” accor
ding to Independent Sector,
which includes the Na
tional Conference of
Catholic Charities.
Independent Sector of
ficials said May 29 that 85
percent of all charitable
contributions come from
individuals whose incomes
are less than $50,000 and
that under the Reagan plan
80 percent of taxpayers, the
“bulwark” of charities’
support, will not itemize on
their tax forms. Currently
about 65 percent of tax
payers do not itemize.
“We think it unfair to
treat one gift to charity dif
ferently from another, to
encourage the high-income
giver but not the middle-
and low-income givers,”
said Bob Smucker, In
dependent Sector vice
president for government
relations.
High-income donors, in
volved in investments and
other financial activity,
often itemize on their tax
returns while those who
earn less and have few or
no investments and other
outside financial activities
usually do not.
Jack Moskowitz, spokes
man for United Way of
America, called the fight to
retain the charitable
deduction “probably the
most important battle for
charities since the incep
tion of the tax code.”
He said that “at a time
when the federal govern
ment is cutting back, we
should not be reducing in
centives for charitable giv
ing.”
Independent Sector
stated in an analysis that
while people will give to
charity regardless of
whether they get a tax
deduction, they give more
when they can claim a
deduction.
The Reagan tax docu
ment, however, stated that
the charitable deduction
for non-itemizers is un
necessary because the tax
payer already gets the
benefit of the standard
deduction; because the
deduction is difficult for the
Internal Revenue Service
to verify; and because
“dishonest taxpayers are
thus encouraged to believe
that they can misrepresent
their charitable contribu
tions with impunity.”
In addition, according to
the tax document, “there is
little data indicating
whether the charitable con
tribution deduction for non-
itemizers has significantly
increased the level of
charitable giving.”
The tax plan also pro
poses to eliminate the
deduction for qualified
adoption expenses, such as
court costs, adoption fees
and attorneys’ fees, incur
red in adopting a child
“with special needs.”
Usually, such a deduc
tion is limited to $1,500, ac
cording to the tax docu
ment.
“The allowance of a
deduction for certain adop
tion expenses is an inap
propriate way of providing
federal support for those
who adopt children with
special needs,” according
to Reagan’s plan.
However, the plan adds
that the government an
ticipates providing a new
program for assisting
families adopting children
with special needs but does
not specify the type of pro
gram envisioned.
Mother Teresa Plans U.S. Visit
NEW YORK (NC) -
Mother Teresa, founder of
the Missionaries of Charity
in Calcutta, India, plans to
visit the United States in
June to receive the
Presidential Medal of
Freedom and to address
the National Right to Life
convention in Washington.
According to Sister
Priscilla, superior for the
Missionaries of Charity in
New York, Mother Teresa
is scheduled to receive the
Presidential Medal of
Freedom June 20 for her
humanitarian efforts on
behalf of the world’s poor.
The award, announced in
April, is the nation’s
highest civilian honor and
celebrates outstanding
work in various fields.
President Reagan pre
sented the medals at the
White-House - May 23'to this
Ik, f ' ~,
Mother Teresa
year’s recipients, but
Mother Teresa could not
attend.
Mother Teresa, who has
called abortion “the
greatest misery of our
time,” will address the
June 20-22 National Right
to Life convention in
Washington June 21.
Sister Priscilla said
Mother Teresa also will
take part in the June 24
dedication of a home for
the poor run by the Mis
sionaries of Charity in
Washington.
She will attend a Mass at
St. Patrick’s Cathedral in
New York June 12 for the
first profession of 11
members of the Mis
sionaries of Charity.
She then will speak on the
role of women in the
Catholic Church June 18 in
New York at a conference
sponsored by the National
Catholic Coalition.
According to Sister
Priscilla, Mother Teresa
also plans to visit a home
for the poor in Toronto dur
ing her trip.