Preliminary Thoughts on the Trump Administration’s Impact on Not-For-Profit Organizations
Many not-for-profit organizations may be impacted by new policies coming from the Federal government as a result of the 2016 election. While it is obviously too early to tell, you should be closely monitoring the kinds of proposals that are being presented by the incoming administration during the transition period, and then, the status of legislation once both the new president and Congress have been installed. This will give you time to plan for the effects of these changes. A few preliminary thoughts:
One of the tax proposals that President-elect Trump advanced during the campaign season was a cap on itemized deductions of $100,000 for single filers and $200,000 for married couples filing jointly. In addition, it seems likely that 2017 tax rates will be lower for both corporations and individuals than in 2016. Both of these proposals suggest that a 2016 contribution is more valuable to your donors than one in 2017. You may want to reach out to donors before the end of the year.
If you receive federal funds, you are going to want to keep tabs on budget proposals to see if the programs that the government funds through you may be impacted. Many commentators expect that spending on domestic programs will need to be cut in order to fund both the tax cuts and the increased military spending President-elect Trump talked about during the campaign. If you think your program might be affected, start planning now for alternative revenue sources and/or reductions in programs.
Regulatory reform is also likely to be on the Federal agenda in 2017. At the same time, abuses in the not-for-profit sector have been an area of concern to legislators in both parties in recent years. Whether there will be changes in regulations affecting the not-for-profit sector is an open question. This is another area where you will want to keep your eyes on developments.
Of course, it is impossible to predict with any certainty what the ultimate effects of new policies will be for any sector of America. However, given the number of changes that were discussed during the campaign, it seems likely that some things will affect not-for-profit organizations. You should keep a close watch on proposals, provide your legislators with comments if you think it appropriate and plan to be proactive, rather than reactive, in preparing your organization for the effect of whatever changes are enacted.
For more information, contact Larry Sophian at312.670.7444. Visit ORBA.com to learn more about our Not-For-Profit Group.