Do Share-of-Income Limits on Tax-Deductibility of Charitable Contributions Affect Giving?

12 Pages Posted: 23 Jan 2018 Last revised: 13 Oct 2018

See all articles by Nicolas Duquette

Nicolas Duquette

University of Southern California

Date Written: August 30, 2018

Abstract

The 2017 Tax Cut and Jobs Act increased the limitation on the tax deductibility of charitable contributions from 50 to 60 percent of adjusted gross income. This note estimates the effect of the share-of-income limitation on giving for the first time. Patterns in giving over time and across charities coincide with earlier changes in the share-of-income limit, consistent with a substantial policy effect. I estimate that the 2017 limit increase will boost aggregate household giving on the order of $10 billion.

Keywords: charitable giving, income taxation, deductibility limits, public policy

JEL Classification: D64, H24, H31, L31

Suggested Citation

Duquette, Nicolas, Do Share-of-Income Limits on Tax-Deductibility of Charitable Contributions Affect Giving? (August 30, 2018). Economics Letters, Forthcoming. Available at SSRN: https://ssrn.com/abstract=3102493 or http://dx.doi.org/10.2139/ssrn.3102493

Nicolas Duquette (Contact Author)

University of Southern California ( email )

2250 Alcazar Street
Los Angeles, CA 90089
United States

HOME PAGE: http://www.nicolasduquette.com

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