CARE bill nearing passage
It appears that a tentative agreement has been reached between Senate Majority Leader Tom Daschle and Minority Leader Trent Lott on the Charity Aid, Recovery and Empowerment Act (CARE bill).
Republican senators have now agreed to allow Senator Phil Gramm to offer an amendment that expands the 25 percent capital gain exclusion for sales of conservation land to charities. If this option becomes available to other charities, it could create a new and favorable charitable gift opportunity for donors who own real property.
It is possible that President Bush (could sign) the CARE Bill in early October. Then it will be possible to use the options for IRA direct gifts and rollovers into charitable trusts and gift annuities to satisfy required distribution amounts for year 2002.
There are three basic reasons why passage now seems probable.
1. Low cost – The Congressional Budget Office suggests that the bill will cost $10 billion in 10 years. In government terms, $1 billion per year is a tiny fraction of the federal budget.
2. Election year politics – No senator in an election year wants to vote against his or her local charities. When the vote is taken on the Senate floor on the CARE Bill, it is highly probable that it will be a unanimous voice vote. The CARE Bill has the political advantage of being popular in home states and districts, while having modest cost.
3. White House support – The CARE Bill is referred to in the media as “President Bush’s charitable giving package.” Clearly, the bill has White House support and is perceived as a highly-favored bill by a president with a high approval rating.
This bill seeks to approve an additional philanthropic and financial planning concept that could provide immediate and long-term support of our community non-profit organizations. To voice your support to your elected U.S. senatorial representatives, use this link: http://www.senate.gov/contacting/index.cfm
Charles Schultz, JD
President, Gift Law
Edward W Cotney, CPhD
Executive Director, Heritage Solutions
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