Philanthropy Roundtable recently spoke with Rep. Mike Kelly (R-Pa.), chairman of the House Ways and Means Subcommittee on Tax, about his ongoing support for the philanthropic sector. In this interview, he discusses why congressional efforts to protect charitable giving are important and how he is working to give donors the tools they need to help strengthen communities.
Q: Congressman Kelly, you’ve been a champion for philanthropy and the charitable sector. Last year, you led a Dear Colleague Letter with 12 of your bipartisan Ways and Means colleagues in support of donor-advised funds and private foundations. That letter successfully beat back legislation that would have restricted charitable giving. You have also been a long-time proponent of enhancing the IRA charitable rollover provision, which was included in legislation Congress passed last year. Can you share a little bit with our donors about why these legislative efforts were important?
Kelly: These legislative efforts remain incredibly important because we’ve seen the positive impact these investments can have on a community firsthand. Donors and charitable organizations have given record amounts to support their neighbors in need. I have advocated for this type of legislation over the years because it provides a great return on investment for everyone involved.
Q: As you know, the charitable sector is critical in supporting the most vulnerable in our communities. But there are some lawmakers, including conservatives like Sen. J.D. Vance, who argue we should end tax exemptions for nonprofits and foundations. Vance has called for the government to seize the assets of the Ford Foundation. What advice would you offer colleagues on why philanthropy and the charitable sector are worth defending — no matter what side of the aisle you’re on?
Kelly: I encourage my colleagues in Congress to further study this issue and learn more about it. Donor-advised funds traditionally are community driven. In 2020 – during the height of the COVID-19 pandemic – DAFs at 84 community foundations granted more than $6.7 billion. This funding was used, in part, to directly help local organizations in need at a time when a growing number of Americans were in need. Legislation like the bills I’ve supported over the years helped make that possible. We should consider ways to expand upon that amount of giving, not limit it. To me, this isn’t a red or blue issue. This is a red, white and blue issue.
Q: Let’s turn to a question about IRS oversight. In your role as chairman of the Ways and Means Subcommittee on Tax, you are at the forefront of IRS oversight. Unfortunately, the IRS has fallen short of its duties in the past — whether it is leaking nonprofit donor information or discriminating against conservative organizations applying for 501(c)(3) status. Can you tell us how the Ways and Means Committee plans to help protect charities and their donors from IRS abuse?
Kelly: As the former top Republican on the Ways and Means Oversight Subcommittee and now as the chairman of the W&M Tax Subcommittee, I have seen firsthand how the IRS can encroach into our everyday lives. My goal is simple: to claw back the reach of the IRS and to protect the hardworking American taxpayer. I am working to continue to give donors the tools they need to be successful to enable our communities with stronger philanthropic leaders, not a bloated bureaucracy that is looking for their cut of the donation.
Q: My final question is about donor privacy. Back in 2021, our donor community cheered the U.S. Supreme Court decision upholding the right to give anonymously in the Americans for Prosperity Foundation v. Bonta case. But we all know that Supreme Court decisions aren’t carved in stone, and there are still threats out there. In your opinion, should Congress take action to codify donor privacy protections?
Kelly: Over the years, we have seen the IRS leak taxpayers’ private information. I don’t believe the government should require more personal information than it already needs. I will continue to explore all options on the table to protect a donor’s privacy and to ensure that they can continue to give anonymously. After all, this is about helping our fellow men and women, not about who should receive the credit.
Read more about Philanthropy Roundtable’s work to protect philanthropic freedom.
