Move to Restore Charitable Tax

Remember when you write a check and then check a box on your Michigan income tax forms and receive a tax credit for donating to things like institutions of higher learning, public art, libraries and the like? Well, if the Michigan Senate Finance Committee has its way, you just might get those options back some day.

The Senate Finance Committee today approved legislation to restore tax credits for certain donations. Senate Bills 461-464, introduced by State Senators Colbeck, Schuitmaker and Hansen, would restore credits eliminated five years ago for charitable donations to libraries, colleges and universities, food banks and homeless shelters. Credits would also be reinstated for adoption expenses and automobile donations.

Senator Patrick Colbeck, a Canton Republican, says, "Families and individuals know the most appropriate way to spend their money; they do not need the government's oversight." He adds, "By restoring these deductions we are putting more hard-earned money back into the hands of taxpayers and providing them with an incentive to reach out and help their neighbors in the manner in which they see fit."

Tanya Schuitmaker, the Republican Senator from Lawton tells us, "These charitable programs have a positive effect on our citizens and our society. When these credits were eliminated, it negatively impacted many of these groups. Giving taxpayers an incentive to donate to these programs will go a long way toward protecting our most vulnerable citizens."

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Senator Goeff Hansen is also a Republican representing Hart. He says, "Parents who have the means to provide loving and permanent families for children through adoption may not be able to afford to adopt. Restoring the adoption credit will benefit parents and children by making adoption a more viable option again."

The charitable tax credits were eliminated in 2011 as part of a comprehensive tax reform that sought to reduce taxes and treat taxpayers equally.

SB 461, introduced by Colbeck, would allow taxpayers to receive a credit for donations made to various programs in public art, libraries, radio, institutions of higher learning and museums.

SB 462, sponsored by Schuitmaker, would allow a taxpayer to receive a credit for donations made to food banks and kitchens, homeless shelters, and community foundations. 

SBs 463 & 464, introduced by Hansen, would allow a taxpayer to receive a credit to offset qualified expenses for adoptions and a credit for automobile donations to qualified charitable organizations, respectively.

The credit amount would be up to 50-percent of the charitable contribution made. The maximum credit would not exceed $100 or $200 for a joint return for SB 461-462; $1200 for SB 463, and $50 or $100 for a joint return for SB 464. 

The bills all head now to the full Senate for consideration.

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