If you heard President Obama mention the “Buffet Rule” during his State of the Union address last week and worried whether the incentives for charitable giving would also be restricted, we now know that they will not. On February 1, Senate Democrats introduced the first proposed rule mirroring the Buffet Rule, officially named the “Paying a Fair Share Act.”
As mentioned in the President’s address and reflected in the administration’s “Blueprint for an America Built to Last,” the rule applies a minimum 30% income tax rate for taxpayers with AGI above $1 million. More importantly for charities, the rule maintains the current incentives for charitable giving by permitting wealthy taxpayers to continue receiving credits equal to the value of the charitable contributions deduction.
Some pundits anticipate that the bill will hit a brick wall of Republican opposition. Regardless, followers of this blog will be kept apprised of the bill’s progress.