President Donald Trump signed a $1.5 trillion dollar tax reform bill into law Friday -- the biggest overhaul of the U.S. tax code in decades. But some worry it will have unintended consequences for local charities.
The bill doubles the standard deduction. For singles, it's going up to $12,000 and $24,000 for those filing jointly.
For many, that means there's no need to itemize their charitable donations, and some organizations worry that will take away a big incentive for people to donate.
According to an Indiana University study, 28 million fewer Americans will itemize their tax return, and it could result in a $13 million drop each year in charitable giving.
In Austin Friday, it was an early Christmas at the Salvation Army.
"A lot of these parents are working parents that are doing all that they can to just make ends meet,” said Major Andrew Kelly. "They don't have to worry about what their child will have on Christmas morning.”
Parents picked up bags of presents that were donated through the Angel Tree program.
Kelly said they’re handing out presents that have been collected for 7,000 local children.
Angela Brown was there for her goddaughter.
"We kind of hit a rough spot this year,” said Brown.
She reached out to the Salvation Army for help.
"If it wouldn't be for the salvation army, we'd have nothing,” said Brown.
But it's help like this, some worry will go away.
"The organization relies totally on donations from the community to do our services for people,” said Kelly.
According to Kelly, they house more than 250 people each night in their Austin shelters. He said they also work to pull people out of poverty and work to find a better paying job.
"That's so important to be able to provide that for people in our community,” said Kelly.
But with the new tax code doubling the standard deduction, some believe it takes away the incentive to donate.
"We’re concerned,” said Kelly.
Major Andrew Kelley said they feel people are motivated by current tax benefits, saying they see more donations in November and December than the rest of the year and more on the last two days of the year than in all of November.
"We’re not certain that we're going to be able to get not only what we've been counting on, but what we need in addition,” said Kelly.
Without all those donations, Kelly tells me they may have to cut services or even delay the opening of their new shelter.
"We can't afford to lose gifts we've had before,” said Kelly.
Over at Goodwill Central Texas, it's a similar story.
"We're concerned because we don't know,” said Traci Berry, the Chief Learning and Engagement Officer at Goodwill. "We're not sure what's truly going to happen, so we just hope that people will donate regardless.”
She said they see a direct correlation between donated items and the services they provide.
"It's actually amazing what one donation can do,” said Berry.
According to Berry, the money generated from the sale of a donated item helps them provide education and job training, as well as operate the only high school for adults in the state.
They’re all services helping people right here in Central Texas.
"This community, in particular, is really generous,” said Berry. "We're really hopeful that it's not going to change people's habits.”
Any of the products that don’t sell, Berry said they recycle. So, she wants to encourage people to donate old clothes, bags or shoes to them -- not the landfill.
"We see a huge amount of donations of goods. People clean out their closets,” said Berry. "People are always going to need to clean out their closets."
But she hopes most of all it will be motivated by good will.
"We believe that they're going to keep giving,” said Berry. "The number one reason people say they give isn’t' for the tax purpose, its' because they think it's the right thing to do."
"Thank you, and we love you from our hearts, from the deepest part of our hearts,” said Brown.
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