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NEWS DETAILS
| How Jobs Package will Affect Nonprofits |
| 9/9/2011 |
The President’s jobs package proposed last night, acknowledges the important economic impact of promoting nonprofit employment through its payroll tax cuts, but the plan must not also include proposals that would force nonprofit job cuts, such as a limit on the value of charitable deductions.
- The payroll tax cuts in the President’s jobs package apply to all employers, including nonprofits.
- We are gratified that the Administration chose hiring incentives that recognize the valuable contribution that nonprofit employers make to their local economies.
- However, it is essential that Congress retain the current law incentives for charitable giving to ensure that nonprofits have the resources to employ qualified workers who can provide the services that our communities need right now.
- It would be counterproductive to pay for the jobs package by limiting the value of the charitable deduction because such a move would force nonprofits to cut jobs.
Last night, President Obama presented a new job creation proposal that could help nonprofits in several ways. The American Jobs Act would:
- Reduce the payroll taxes that nonprofits pay.
- Eliminate these payroll taxes if your nonprofit adds new staff or increases wages.
- Reduce your staff’s payroll taxes through 2012.
- Give tax credits to businesses that hire veterans and long-term unemployed workers. It’s unclear whether these would apply to nonprofits.
- Provide federal support for state budgets to prevent teacher and public safety worker layoffs.
- Create new building and infrastructure projects which might involve some nonprofits.
It's unclear whether Congress will take up this proposal. The President also hasn’t yet given details about how this would be paid for. It’s possible he could propose limiting the charitable deduction for high-income tax payers to offset some of the costs. |
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