IMPACT
02/18/2011 03:00 pm ET Updated May 25, 2011

2012 Federal Budget Funding Changes Could Hit Aid, Art Charities Hardest

The new budget promises to decrease spending by at least $1 trillion over the next decade, however it may come at a high price -- the decline of charitable funding.

The Washington Post reports that charity budgets would be hindered or slashed under the proposed 2012 bill, especially when it comes to international aid.

The Post reported that international aid programs that fund food, refugee, and AIDS relief could be slashed by up to 50 percent.

Rep. Kay Granger of the House subcommittee handling foreign aid said that the current US budget crisis has compelled them to focus on national issues, and "quit spending at that level."

Tom Hart of ONE, an anti-poverty organization, told the Post that these cuts will have significant repercussions.

"We know that the U.S. government is going to have to do more with less. The point we're making is, cuts to this part of the budget have an incredibly big impact on people who can least afford it. There are very few places in the federal budget where funding translates into lives saved. And this is one of them."

NPR reported on a different aspect of the bill which might discourage large donations -- a ceiling on tax breaks. However, Obama's new budget would cap itemized tax deductions at 28 percent for those earning more than $200,000 per year.

Under current law, the wealthiest donors get the largest tax deductions, making large contributions easier while encouraging the flow of more money to nonprofits.

Una Osili of the Center for Philanthropy at Indiana University told NPR that the new deduction cap would directly affect arts charities.

"High-net-worth donors disproportionately are more likely to give to the arts."

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