Since Thursday, CBS News has run two different reports -- both by correspondent Jan Crawford -- which fearmonger about the possibility that private charities and millions of people who benefit from them will suffer because the new tax cuts passed by Republicans would result in fewer people taking tax deductions for charitable contributions as in the past.
Not much thought was given to the possibility that if people's taxes are being cut, they might donate even more money to charities, as Crawford was preoccupied with people who will stop itemizing who might therefore lose interest in making donations.
Update: On Saturday, a third story on the same topic aired on the CBS Weekend News. See below for details and complete transript.
On Thursday's CBS Evening News, substitute host Bianna Golodryga talked up the possibility of negative consequences of the tax cuts as she set up the report: "Well, it's the season for giving, but nonprofits are bracing for a potential drop in donations next year. The new tax law signed by President Trump last week changes the math for writing off charitable contributions. Jan Crawford explains."
After recalling a Washington, D.C.-based charity called So Others Might Eat which helps feed poor people, Crawford intoned: "Under the new tax reform law, nonprofits like So Others Might Eat could soon be taking a big hit."
Then came a soundbite from one of the group's members, Kate Wiley, who further warned: "We are absolutely concerned that tax reform and also just confusion about what new laws are going to be will affect charitable giving."
The CBS correspondent then went to Brian Gallagher of the United Way who fretted that there will be as much as $13 billion less donated to private charities nationally next year, theorizing that 10 million people might lose services.
On Friday's CBS This Morning, another report by Crawford ran which focused on the same charity. Golodryga, substitute-hosting again, set up the report with a similar warning:
Republican leaders say the new tax code will save millions of Americans money, but it could cause problems for charities. Nonprofits received about $390 billion in donations last year, but, by some estimates, the new code could drop -- result in a drop in $20 billion in donations per year. Jan Crawford is at a charity that feeds the homeless in Washington with why people are concerned the new law could mean less giving.
Crawford began the report by arguing that charitable deductions entice many people to donate at the end of the year to reduce their tax bills, and then fretted that, under the new tax laws, 90 percent of Americans will not have a tax incentive to donate to charities because they will use the new larger standard deduction instead of itemizing deductions.
As the piece mostly pushed the argument that people may lose interest in donating to charities because they will no longer itemize deductions, it took until the end of the story for Crawford to admit that people mostly give because they want to give instead of being motivated by getting a tax benefit, Crawford:
Nonprofit leaders are quick to point out most people don't give to charity just to give a tax break, but even a four or five percent decrease in donations could have a big impact on community organizations that are already struggling to stay afloat.
After Crawford turned the floor back over to the show's substitute hosts, Golodryga and Dana Jacobson continued to fret over the possible effects of the new tax law:
DANA JACOBSON: It's sort of sad to think of some of those charities that may lose out just because of the loss of a deduction.
GOLODRYGA: Yeah, effecting the people that need it most.
JACOBSON: Yeah, exactly.
Complete transcripts of both reports follow:
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Thursday, December 28, CBS Evening News:
BIANNA GOLODRYGA: Well, it's the season for giving, but nonprofits are bracing for a potential drop in donations next year. The new tax law signed by President Trump last week changes the math for writing off charitable contributions. Jan Crawford explains.
JAN CRAWFORD: In the nation's capital, this charity serves hundreds of meals daily to the needy, operating largely through charitable donations. Under the new tax reform law, nonprofits like So Others Might Eat could soon be taking a big hit.
KATE WILEY, SO OTHERS MIGHT EAT: We are absolutely concerned that tax reform and also just confusion about what new laws are going to be will affect charitable giving.
CRAWFORD: It's a concern shared by nonprofits across the country because the new tax law lowers incentives for people to donate. Before, people could reduce their tax burden by writing off charitable donations and itemizing them on their tax returns, Under the new law, many middle class taxpayers will no longer need to itemize, and instead offers a bigger standard deduction amounting to $12,000 for individuals and $24,000 for couples. But here's the rub: If you don't itemize, you can't deduct your charitable donations.
BRIAN GALLAGHER, UNITED WAY WORLDWIDE: People will continue to give to charity -- they just won't give as much. If you get $1,000 more in your paycheck and there's no financial incentive to give it to charity, you may still give it to charity, but you're probably going to get the washing machine.
CRAWFORD: United Way CEO Brian Gallagher says his organization -- which collects $3.5 billion a year in donations and funds charities like So Others Might Eat expects to take in $300 million less. He estimates that overall charitable giving will go down $13 billion a year, which would mean up to 10 million people will lose needed services.
CRAWFORD: What is the impact of that?
GALLAGHER: The impact is lives -- it's human lives.
CRAWFORD: Now, financial advisors say, if you're planning to stop itemizing, you should go ahead and make some of your 2018 donations to charity in the next few years before the end of the year so you can deduct what you are planning to give to charity or your church on this year's tax returns.
Friday, December 29, CBS This Morning:
BIANNA GOLODRYGA: Republican leaders say the new tax code will save millions of Americans money, but it could cause problems for charities. Nonprofits received about $390 billion in donations last year, but, by some estimates, the new code could drop -- result in a drop in $20 billion in donations per year. Jan Crawford is at a charity that feeds the homeless in Washington with why people are concerned the new law could mean less giving. Jan, good morning.
JAN CRAWFORD: Well, good morning. For organizations like So Others Might Eat, here in the nation's capital, at the end of the year tends to mean a spike in donations. That's because people see charitable contributions as a way they can cut their tax bill. But next year, that might change. When temperatures in Washington dip below freezing, these Salvation Army volunteers are hitting the streets. handing out food to those in need. Organizations like these across the country rely on donations.
In 2017, as many as 30 percent of taxpayers can reduce their tax bill by itemizing deductions, enticing them to write off charitable donations. But, under the new law, around 90 percent of taxpayers are likely to choose the new doubled standard deduction instead, eliminating the taxes, reducing the incentive to give to charity
BRIAN GALLAGHER, UNITED WAY CEO: There'll be 30 million fewer people itemizing their taxes.
CRAWFORD: United Way CEO Brian Gallagher says his organization is able to serve 60 million people a year, thanks to more than $3 billion in charitable donations.
GALLAGHER: The average contribution by a United Way donor in the U.S is about $350.
CRAWFORD: And those are the donors that will now have no incentive to give under the tax code?
GALLAGHER: They'll have less incentive.
CRAWFORD: Additional changes to the estate tax could contribute to a further decline in charitable giving each year.
EILEEN HEISMAN, NATIONAL PHILANTHROPIC TRUST: We're really not sure what's going to happen, but --
GALLAGHER: Elieen Heisman of the National Philanthropic Trust says such a decline would force charitable organizations nationwide to cut back on services.
HEISMAN: For hospitals, it's about serving people who are sick from daycare centers to kitchens. I mean, if you can imagine 10 percent of the budgets of all the charities in the United States perhaps being effected. That could really be substantial.
CRAWFORD: Nonprofit leaders are quick to point out most people don't give to charity just to give a tax break, but even a four or five percent decrease in donations could have a big impact on community organizations that are already struggling to stay afloat. Dana?
DANA JACOBSON: Jan, thank you very much. It's sort of sad to think of some of those charities that may lose out just because of the loss of a deduction.
GOLODRYGA: Yeah, effecting the people that need it most.
JACOBSON: Yeah, exactly.
Saturday, December 30, CBS Weekend News:
DON DAHLER: Many charities are dreading the new year. The tax overhaul doubles the standard deduction to $12,000 for an individual and $24,000 for a married couple. And charities are worried that could dry up donations. Here's Meg Oliver.
MEG OLIVER: How damaging was the fire?
CHRIS BARTON, CATHOLIC CHARITIES: It was devastating.
OLIVER: This Catholic Charity food pantry in Patterson, New Jersey, lost everything just before the holidays. How quickly did you replenish?
BARTON: Within a week, we had donations from the community.
OLIVER: Small donors.
BARTON: Yes, absolutely.
OLIVER: That's your bread and butter.
BARTON: It is.
OLIVER: But Chris Barton with Catholic Charities is concerned stocking won't be as easy because of the new tax law. Millions of Americans are expected to take advantage of the new standard deduction that's been doubled, meaning fewer people will itemize their deductions. Barton is worried many Americans won't donate because they won't benefit from the charitable tax break. Without them, do you have a backup plan?
BARTON: Everything we do relies on donors and volunteers.
OLIVER: Not alone. Charities like the American Red Cross, the Salvation Army, and the United Way all depend on small contributions. The United Way expects to lose up to $450 million a year under the new plan. You don't think there's going to be less people giving to charities?
MARK STEBER, JACKSON-HEWITT: I would tell you just the opposite.
OLIVER: Mark Steber is the chief tax officer for Jackson Hewitt, and recalls when the charitable deduction was scrapped in the '80s.
STEBER: I would tell them to look at the 1985 tax law that took away -- took away the ability to deduct it on your tax return, and donations went up.
OLIVER: Are you worried about the future with this new tax plan?
BARTON: I think it remains to be seen.
OLIVER; Barton is hoping people will continue to give not for a tax break, but for the good of humanity. Meg Oliver, CBS News, Patterson, New Jersey.