As happens intermittently in Congress, the charitable deduction is once again closing in on the chopping block. But before you get involved with the debate, have you ever wondered where the charitable deduction came from?
The charitable deduction first appeared during World War I, when it was enacted to help charities survive the war since wealthy donors no longer had surplus funds to contribute. Advocates of the new law argued that the survival of weaker charities was at risk. As they faltered, the argument went, a stronger and bigger government would be required as it would become wholly responsible for carrying out the work that the fallen charities otherwise would have done.
Not everyone was so positive about charitable organizations. Many believed charities to be simply an extension of the power of the wealthy. However, these arguments were mostly silenced after the start of the War.
So when your holiday party conversation turns to the impending fiscal cliff and the charitable deduction debate, you can unite the party with a little history.