Tax Extenders

On February 12, the House passed legislation (H.R. 644) that would make permanent the IRA charitable rollover and the enhanced deductions for donations of food and land conservation easements, all of which expired on January 1, as well as simplify the excise tax rate on the investment income of private foundations.

Read the March 2015 joint letter to the Senate Finance Committee | Read the Nov. 2014 sign-on letter to Congress
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The Issue
A number of critical giving incentives that are often included as part of the annual "tax extenders" package expired for the fourth time in recent years at the start of 2014, but were reinstated for the 2014 tax year on December 19, 2014. The package of extenders expired again on January 1, 2015. Charitable giving incentives include:


Charitable tax provisions pass House
On February 12, the House passed the America Gives More Act (H.R. 644), with support from 39 Democrats and all but one Republican. The legislation packages together bills to extend permanently the IRA charitable rollover (H.R. 637), the enhanced and expanded deduction for donating excess food inventory (H.R. 644), and the enhanced deduction for land conservation easements (H.R. 641). Also included is a bill (H.R. 640) that would simplify to 1 percent the excise tax rate on private foundations’ investment income.

Congress restores giving incentives for 2014 tax year

The Senate signed off on legislation (H.R. 5771) on December 16, 2014 to reinstate retroactively dozens of expired tax provisions, including the IRA charitable rollover and the enhanced deductions for donating land conservation easements and food inventory. While taxpayers will be able to employ these provisions in the upcoming filing season for the 2014 tax year, the package will expire again in roughly two-weeks' time, on January 1, 2015. The House passed the measure on December 3 and the president signed it into law on December 19.

House fails to advance permanent bill for charitable giving incentives

On December 11, the House failed to advance the Supporting America's Charities Act (H.R. 5806), a bill that would have made permanent the IRA charitable rollover and the enhanced deductions for donations of land conservation easements and food inventory. The vote was 275 in favor and 149 opposed, just eight votes shy of the two-thirds supermajority needed under the expedited procedural rule used to consider the legislation.

Because the IRA rollover and other incentives have come under close scrutiny, Independent Sector is working closely with our members and will support coalitions to make the case for bringing greater certainty to these powerful giving tools.

  • In January 2012, Independent Sector sent a letter to Finance Committee Chairman Max Baucus (D-MT) and Ranking Member Orrin Hatch (R-UT) urging the reinstatement of the charitable provisions as soon as possible. IS also signed onto a broader tax coalition letter delivered to every Member of Congress that month.
  • In March 2012, an op-ed by IS President and CEO Diana Aviv was published in Roll Call. IS also submitted a statement for the record in support of permanently reinstating these giving incentives for the April 26, 2012 House Ways and Means Select Revenue Measures Subcommittee Hearing on extenders.
  • Independent Sector organized a sector-wide letter that was sent to all U.S. Senate offices in February 2014, in support of legislation to renew and enhance the expired IRA charitable rollover provision. Nearly 500 organizations from across the country signed on.
  • Leading up to a markup in the House Ways and Means Committee, Independent Sector and 252 organizations sent a letter to the panel, urging them to extend permanently the three charitable extenders.
  • In advance of a House floor vote in July 2014, Independent Sector delivered another sign-on letter joined by over 850 organizations, as well as published a newspaper ad in Roll Call with the list of signers.
  • Shortly after returning for a lame duck session in 2014, Independent Sector and 1,031 organizations sent a letter to every Member of Congress in support of making the charitable provisions permanent in any year-end deal. IS President and CEO Diana Aviv also joined with sector leaders to send a letter published in POLITICO to the President and leaders in Congress, on December 2.
  • In March 2015, Independent Sector, along with United Way Worldwide, YMCA of the USA, The Jewish Federations of North America, National Council of Nonprofits, Council on Foundations, Feeding America, and Land Trust Alliance sent a joint letter signed by their senior leadership asking the Senate Finance Committee to move forward quickly on the America Gives More Act

The set of 55 tax provisions that regularly expire and are reinstated are known collectively as "tax extenders." The package includes three charitable giving incentives: the IRA charitable rollover, the enhanced charitable deduction for food inventory, and the enhanced charitable deduction for land conservation.

After these measures expired at the end of 2011, the American Taxpayer Relief Act of 2012 (ATRA) extended through 2013 and retroactively through 2012 all three of the charitable tax extenders, as well as the basis adjustment to stock of S corporations making charitable contributions of property. The package did not include previously available extenders that offered enhanced deductions for books and computer equipment.

In 2013, some lawmakers in the House signaled a preference to defer to former Ways and Means Committee Chairman Dave Camp's (R-MI) comprehensive tax reform efforts for renewal of their preferred extenders. A lack of legislative action in 2013, however, allowed all extenders to expire on January 1, 2014.

In 2014, lawmakers in both chambers advanced legislation to make permanent only certain tax extenders and extend others only temporarily. The Senate Finance Committee passed by voice vote in April the EXPIRE Act (S.2260), which would have renewed through 2015 the entire extenders package. The bill, however, failed to reach the Senate floor due to partisan disagreement over the amendment process. In July, the House passed the America Gives More Act (H.R. 4719), which would have restored permanently three charitable extenders as well as extended through April 15 the deadline for claiming charitable donations on the previous year's tax filing and simplified to 1 percent the excise tax rate for private foundations' investment income. The Senate did not take up the bill. In December, the House was unsuccessful in passing under suspension of the rules narrower legislation, the Supporting America's Charities Act (H.R. 5806), which would have made permanent only the three charitable extenders.

Unable to reach a longer-term agreement on extenders, the lame duck 113th Congress adopted legislation (H.R.5771) in December 2014 to extend the package of expired provisions, including three charitable giving incentives, retroactively for just the 2014 tax year. The provisions were set to expire again in two-weeks' time, on January 1, 2015.


CRS report: Tax Provisions Expiring in 2013 (December 2013)

JCT report: "Legislative Background of Selected Federal Tax Provisions Scheduled to Expire in 2011 or 2012" (April 2012)

IRA Charitable Rollover leave-behind

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