Half Percent Haircut for Charitable Contributions?
I just love these little surprises that pop up at the last minute in major tax legislation. Even if I'm not sure what they mean. Sounds to me like you only get medical above 7.5% of AGI, and you only get charitable above 0.5% of "contribution base" (not defined that I can find, although a similar rule for corporations says 1% of taxable income, but no more than 10%). But I might be wrong. That would not go over well with people who go to church.
SEC. 70425. 0.5 PERCENT FLOOR ON DEDUCTION OF CONTRIBUTIONS MADE BY INDIVIDUALS.
(a) IN GENERAL.—
(1) IN GENERAL.—Paragraph (1) of section 170(b) is amended by adding at the end the following new subparagraph:
‘‘(I) 0.5-PERCENT FLOOR.—Any charitable contribution otherwise allowable (without regard to this subparagraph) as a deduction under this section shall be allowed only to the extent that the aggregate of such contributions exceeds 0.5 percent of the taxpayer’s contribution base for the taxable year.
