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May 19, 2025

Congress is Advancing Tax Reconciliation Package. Take Action!

Nonprofit organizations are under threat. The U.S. House of Representatives is slated to vote as soon as this week on a tax reconciliation package that includes several harmful provisions opposed by AZ Impact for Good and its national partners, the National Council of Nonprofits and United Philanthropy Forum. If enacted, this legislation could threaten the nonprofit and philanthropic sector. On a positive note, the bill also includes a new deduction for charitable giving.

Read NCN’s chart of the tax provisions and full analysis. See also the Forum’s Advocacy, Action & Awareness webpage for a strategic roadmap for philanthropic organizations and nonprofits and its Fact Sheet on the Tax Provisions affecting philanthropy.

Your voice matters! Thanks to the effective advocacy of nonprofit and philanthropic organizations nationwide, House Republicans removed a provision from the tax bill that would have granted unprecedented authority to the executive branch to revoke nonprofit status from organizations without due process. Nonprofits warned this provision would have allowed administrations to target charitable organizations based on ideological grounds.

This is important progress in ensuring the tax bill doesn’t harm nonprofit organizations, and validation of our effective collective advocacy. AZIFG and our national partners will remain vigilant in ensuring such harmful language isn’t added back as tax legislation moves towards enactment.

Action Alert

Nonprofits and philanthropic organizations should contact their Republican Senators and Representatives and urge them to:

❌OPPOSE granting unprecedented authority to the executive branch to revoke nonprofit status from organizations without due process. This provision allows administrations to target charitable nonprofits based on ideological grounds. See NCN’s one-pager on why Congress should protect nonprofits from executive branch overreach.

❌OPPOSE new or expanded taxes on nonprofit organizations, including foundations. These proposals divert scarce resources away from essential services, undermine the ability of charitable nonprofit organizations to meet needs in their communities, and put greater strain on government. See NCN’s one-pager on protecting nonprofits in tax reconciliation for more information.

❌OPPOSE limits on charitable donations as a "pay for" for the bill. These proposals discourage charitable donations made by individuals and corporations, ultimately leaving nonprofits with fewer resources to serve their community.

✔️SUPPORT and EXPAND tax incentives for charitable giving. The bill includes a non-itemizer deduction for charitable giving. Congress should expand the deduction to full scale, as proposed in the Charitable Act, introduced by Sen. Lankford (R-OK), Sen. Coons (D-DE), Rep. Moore (R-UT), and Rep. Pappas (D-NH). See NCN’s one-pager on the Charitable Act for more information.

Congressional Republicans hope to enact the tax package by July 4, although internal disagreements could lead to delays.

Did you know AZ Impact for Good Advocates for nonprofits, grantmakers, and community- focused businesses at the state and federal levels? You can join the Policy Council and help guide the organization's advocacy efforts.

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