CASE President and CEO Sue Cunningham:  

The tax provisions included in H.R. 1, the reconciliation package passed by the U.S. House and Senate and signed by U.S. President Donald Trump, will have mixed implications for charitable giving to schools, colleges, and universities.  

We are deeply disappointed that the final bill includes a significant increase in the endowment tax for private colleges and universities. While the Senate scaled back the more draconian approach initially proposed by the House, the tax increases in the final bill remain substantial, rising nearly 500 percent for the top-tier.  These increases will divert charitable resources away from supporting student financial aid and research at a time when those funds are desperately needed. CASE will continue to urge Congress to repeal the endowment tax entirely so that charitable funds are used as donors intend – to support students who will contribute to the success of the United States economy for generations to come.  

On a more positive note, we applaud the bill’s inclusion of a permanent charitable deduction for non-itemizing taxpayers, a policy CASE has long advocated for alongside the Charitable Giving Coalition. This provision is a transformative step for philanthropy, one we believe will broaden participation in giving and enhance institutions’ ability to fund scholarships, support students, advance research, and serve their communities. We recognize that the cost of permanently expanding the deduction is paid for by a modest 0.5 percent of Adjusted Gross Income (AGI) floor on itemized donations. While CASE generally opposes such limitations, we appreciate that the revenue raised by this modest floor will directly support the expansion of incentives that encourage giving to educational institutions and other charitable organizations. We commend Senators James Lankford (R-OK) and Chris Coons (D-DE), and Representatives Blake Moore (R-UT), Danny Davis (D-IL), Carol Miller (R-WV), and Chris Pappas (D-NH) for their steadfast leadership in advancing this policy.  Their efforts galvanized a bipartisan coalition of more than 20 Senators and 60 House members in support of expanding the charitable deduction.  

We are dismayed, however, that lawmakers did not remove the 35 percent cap on itemized deductions, a provision that will increase the cost of giving for donors in the top tax bracket and diminish charitable giving by itemizers. As a result, students and others served by educational institutions and charitable organizations may experience reduced support.  CASE will work with lawmakers to eliminate this harmful limitation on itemized giving. 

We are grateful to all who advocated on behalf of schools, colleges, and universities, as Congress considered the reconciliation bill, and we thank institutions who activated their alumni and supporters to weigh in through our Alumni for Higher Ed initiative. CASE will continue to encourage our members to engage their alumni in support of policies that advance the vital mission of educational institutions and seek the invaluable voice of alumni for higher education writ large. And, at CASE, we will continue to advocate directly with Congress for policies that promote and protect charitable giving to education.