In The Hill, Paul Major, President & CEO of the Telluride Foundation, and Lora Smith, Executive Director of the Appalachian Impact Fund at the Foundation for Appalachian Kentucky, penned an op-ed about how charitable reforms can support rural communities. Specifically, they explain how philanthropy should work and why tax loopholes that slow the distribution of charitable dollars needs to be closed.
Read below some notable quotes from their op-ed:
“That’s how philanthropy should function: today’s dollars being used to confront today’s challenges.”
“Today, because of loopholes in our tax code, donors can put money in charitable intermediaries — private foundations or charitable investment accounts called ‘donor-advised funds’ — and claim the generous tax benefits of philanthropy without actually giving the money away. That’s a problem: Tax cuts are meant to encourage giving, not hoarding … Americans lose out on tax revenue that otherwise might go toward supporting public programs without any certainty that those dollars will get spent in a way that benefits them.
“Today in the U.S., there are significantly more funds sitting in charitable savings accounts than are being distributed to America’s charities. And the lion’s share of philanthropic work, especially during times of crisis, then falls to under-resourced and poor communities.”
“The lack of giving to some of our most marginalized and poor populations must be addressed. Closing loopholes that slow the distribution of charitable dollars is the right place to start.”
“[T]he ACE Act recognizes the unique role of community foundations and includes protections that ultimately strengthen these pillars of our communities and ensure the highly localized, extremely critical missions of these organizations can continue without additional regulatory burden.”
The full op-ed is available here.