AASLH, the American Association of State and Local History, is advising heritage advocates to contact their elected representatives in Congress this week to let them know about the impact that proposed tax reform legislation would have on history organizations.
On Thursday, November 10, Speaker of the House Paul Ryan (R-WI) and Chair of the House Ways and Means Committee Kevin Brady (R-TX) unveiled the Tax Cuts and Job Act (H.R. 1). This tax reform legislation includes the elimination of several provisions vital to nonprofits and history organizations. AASLH recommends that you call or e-mail your congressional delegation this week and let them know that the removal of these items from the tax code will greatly impact your community and organization. Time is of the essence as the bill is scheduled to come up for a vote before the Thanksgiving break.
Here are specific items that will impact history organizations:
- Charitable Giving Incentives: The doubling of the standard deduction proposed by the bill will put itemized deductions “out of the reach for 95 percent of American taxpayers,” according to the National Council of Nonprofits. In 2017, research from the Indiana University Lilly school of Philanthropy found that without the tax benefit at least $13 billion in annual giving could disappear for the nonprofit sector which includes history organizations and museums. The American Alliance of Museums has an issued a brief with more details on the impact of the removal of the charitable giving deduction.
- Federal Historic Tax Credit: This tax credit, established during the Reagan administration, is a widely used redevelopment tool for abandoned and underutilized properties, from inner cities to small towns across the country. Since 1981, the credit has leveraged more than $131 billion in private investment, created more than 2.4 million jobs, and preserved over than 42,000 buildings that form the historic fabric of our nation. It is a vital tool for historic preservation that should be encouraged. The National Trust for Historic Preservation has a video you can share with your members along with language to use to contact your legislators.
- Nonprofit Nonpartisanship: The legislation includes language that would significantly weaken the protection from partisan politics that has for decades enabled charitable nonprofits, houses of worship, and foundations to remain focused on their missions and problem-solving in their communities. The Johnson Amendment, signed into law by President Eisenhower, prevents 501(c)(3) organizations from endorsing or opposing candidates for public office or diverting charitable assets from mission to fund partisan campaigns. As stated in the Council of Nonprofits’ news release: “The constitutionally suspect change proposed in the House bill would destroy the safe space where people can currently come together, ignoring party labels, to worship and solve community problems.”
- Unrelated Business Income Tax (UBIT): The bill proposes several changes to UBIT liability. It would narrow the exemption for nonprofits by taxing employee fringe benefits such as parking and mass transit and “applying only to income derived from research that is made freely available to the public.”
Contact your federal legislators today to ask them to protect these provisions which are so important to keeping history organizations on mission and assets to their community. Click here to locate your Senator or Congressional Representative.