Obama Angers the United Way and Other Charities with Proposed Charitable Deduction Cut

Leaders of the charitable coalition the United Way swarmed Capitol Hill Tuesday to lobby against the Obama administration’s proposed cap on the charitable deduction in the federal tax code. Lowering the charitable deduction has long been an Obama policy objective.

United Way US CEO Stacey Stewart and 45 local United Way CEOs hit the Hill to urge “Support for the charitable deduction and expanding incentives for charitable giving in the U.S. tax code,” according to a press release issued on United Way’s behalf. The CEOs were also pushing to strengthen the earned income tax credit and the child tax credit.

United Way’s “Hill Day” was marked by predictable bipartisan photo ops but highlighted an uncomfortable rift between Obama and many economic and health charities and organizations that support most of his agenda.

Obama proposed a cap on charitable deductions in his 2014 budget proposal in April, and it is currently being debated in Congress. The proposal would cap charitable deductions with a 28 percent limit, down from its current 39.6 percent limit on high earners. Obama has tried every year since taking office to set a 28 percent cap.

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