Fighting Hunger Incentive Act of 2014

Floor Speech

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Mr. PAULSEN. I thank the chairman for yielding.

Mr. Speaker, I want to speak in support of the legislation, H.R. 4719, the America Gives More Act. This is important legislation that is actually going to increase charitable giving for the benefit of individuals in need across the country while also assisting those vital charities and foundations that serve them in all of our Nation's communities.

These are bipartisan proposals, Mr. Speaker, and the bill will make many of these provisions permanent. It will improve a variety of tax rules governing charitable donations and charitable organizations, encouraging America's taxpayers to give even more generously and enabling charities to serve those in need even more effectively.

I would also like to address a provision specifically, Mr. Speaker, that I authored that reduces and simplifies the provision, the excise tax on private foundation investment income.

Now, private foundations make a world of difference in our communities. I look at Minnesota, my home State. We have 1,400 different foundations. In 2011, about $1 billion is what they annually would donate to those in need. Nationwide, we have got 81,000 foundations that donated almost $50 billion in 2011.

These are impressive numbers, impressive figures, but as impressive as those figures and statistics are, the reality is they could easily be higher. Unfortunately, the Tax Code is actually discouraging large and increasingly larger donations given by private foundations.

Today these institutions, these foundations face a very complicated two-tiered system of taxation, and there are actually perverse incentives built into the Tax Code for a foundation not to make a donation, not to give a contribution in times when those needs might be greatest, such as after a natural disaster.

This legislation eliminates that disincentive so we can make large donations in times of need and replaces the two-tiered system with a simple, flat 1 percent excise tax on all foundation investment income.

It also simplifies the tax planning process. Especially for smaller foundations, this is important so that they can spend their valuable resources not on expensive accounts, not on expensive or high-priced lawyers but, instead, providing grants to grantees. We need to ensure that charitable decisions are based on the needs of our communities, not based on the Tax Code.

This legislation is strongly supported by the Council on Foundations.

The bottom line here, Mr. Speaker and Members, is that every dollar that these organizations are either paying in taxes or they are giving to accountants or attorneys is one less dollar going to those in need. This bill makes compliance easier and ensures that more resources are available.

Mr. Speaker, I commend the chairman for his leadership. I urge my colleagues to join me in supporting this legislation.

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