Administration, Committees Issue Tax Reform Framework

• DOI: http://doi.org/10.1002/npc.30387
• Published date: 01 November 2017
• Date: 01 November 2017

THE LAW OF TAX-EXEMPT ORGANIZATIONS MONTHLY

ADMINISTRATION,

COMMITTEES

ISSUE TAX REFORM

FRAMEWORK

September 27 brought the Trump Administration’s, and Ways and Means

and Finance Committees’, “Unified Framework for Fixing Our Broken Tax Code.”

Three proposals that would decrease charitable giving are included: reduction of

individual tax brackets, a doubling of the standard deduction, and repeal of the

estate tax. Here are the relevant features:

• Retention of the charitable contribution and mortgage interest deductions,

while eliminating most other itemized deductions.

• Consolidation of the current seven tax brackets into three brackets of 12, 25,

and 35 percent, with the possibility of an additional top rate applicable to the

highest-income taxpayers.

• Doubling of the standard deduction, which would encompass the personal

exemptions.

• Repeal of the estate, generation-skipping transfer, and alternative minimum taxes.

• Limiting the maximum tax rate applicable to income of small and family-

owned businesses conducted as sole proprietorships, partnerships, and S

corporations to 25 percent.

• Reduction of the corporate tax rate to 20 percent.

• The possibility of “methods to reduce the double taxation of corporate earnings”

(read: some form of corporate integration). (See the Quote of the Month.) ◆

IRS PUBLISHES UPDATED PRIVATE

FOUNDATION EQUIVALENCY RULES

The IRS, on September 14, published rules by which private foundations may

make good-faith determinations that foreign grantees qualify as a public charity,

so that the grant will generally be a qualifying distribution that does not require © 2017 Wiley Periodicals, Inc.

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DOI:10.1002/npc

Analysis of current developments in tax

and related law for nonprofit organiza-

tions and their professional advisors.

Volume 34 Number 11

November 2017

Also in This issue...

Foreign Foundation Ruled to Not

Have Excess Business Holdings 3

IRS Concocts New Basis for

Revocation: “Sharp Business

Practices” 4

Tax Court Again Uses Merger

Clause to Find Adequate

Substantiation 5

Non-Social Welfare

Organization Corner 6

Government Entity Corner 6

Sponsoring Organization

Ruled to Provide DAF Gift

Substantiation 7

Other Recent IRS Private

Letter Rulings 7

IRS Publishes Data on

Individuals’ Noncash Gifts

in 2014 8

NY Times Analysis: Affirmative

Action Programs Failing 8

Other Developments 8