GRAND RAPIDS (WZZM) -- The fiscal cliff -- and proposed solutions to the federal government budget issue -- may have an impact on the tax benefits people get for donating to charities.
President Obama and lawmakers have until December 31 to come to a budget agreement before automatic tax increases and spending cuts take effect -- the so-called fiscal cliff. One possible cut members of Congress are considering is the reduction or elimination of tax deductions for charitable donations.
Drive down almost any major city block in Grand Rapids and you will see charitable donations at work.
"We see places, buildings, and programs that have been built through philanthropy," says Roberta King, spokeswoman for the Grand Rapids Community Foundation. "We don't want to see anything coming between those gifts between those projects."
Yearly, the foundation raises charitable donations and gives out $11 million in grants to Grand Rapids organizations and causes. The concern now is over what could happen to future efforts if Congress cuts the charitable tax deduction.
"We are very concerned," says King. "If the charitable donation tax deduction goes away, it will have a negative impact on charities in this area -- and on donors. They may be less incentivized to give."
King says the federal government is giving less money to non-profit organizations, so they need charity donations -- and the tax deduction for the donors -- to help make up the gap.
"Having that deduction removed is a real threat to the GR community foundation, and many many non profits in this community," she says.
You can find out more about the status of government negotiations -- and the impact of the fiscal cliff -- on our website.