Gov. Affairs | Issue 16 | June 18, 2025
June 18, 2025 - This content will be updated as developments unfold.
Latest Developments:
“One Big Beautiful Bill”
As key provisions of the Tax Cuts and Jobs Act (TCJA) are set to expire at the end of 2025, the 119th Congress is advancing tax legislation through the budget reconciliation process to extend the TCJA and reflect Republican priorities. The House Ways and Means Committee released draft legislation on May 12, with budget impact estimates following shortly after. The bill was approved along party lines on May 14 and passed by the House on May 22. On June 16, the Senate Finance Committee released its version of the tax provisions within the broader reconciliation package.
The Senate version of the tax bill makes several important changes to the House-passed version, with both positive and concerning implications for the nonprofit sector:
Positive Changes
No New Foundation Taxes: The Senate removes a House proposal to impose steep, tiered excise taxes on private foundations - up to 10% for the largest. This change protects charitable resources at a time of growing community need.
No Tax on Transportation Benefits: The Senate rejects the House proposal to reimpose taxes on nonprofit employers for providing parking or transit benefits, an idea previously repealed due to compliance challenges.
Expanded Universal Charitable Deduction: The Senate expands the proposed non-itemizer charitable deduction to $1,000 for individuals and $2,000 for couples, building on the bipartisan Charitable Act.
Concerning Provisions
1) Limits on Charitable Deductions:
Caps itemized deductions for high-income taxpayers (Section 70111).
Imposes a 0.5% floor on individual charitable deductions (Section 70425).
Adds a 1% floor on corporate charitable deductions (Section 70426).
These changes could discourage giving by individuals and businesses.
2) Cuts to Safety Net Programs:
Medicaid: The Senate bill may cut even more than the House’s $800 billion reduction, putting millions at risk of losing healthcare.
SNAP (Food Assistance): While less severe than the House version, the Senate still shifts administrative costs to states and removes key exemptions from work requirements, potentially increasing food insecurity.
Next Steps
The Senate will vote on the bill as early as next week. Because changes were made, it must then return to the House for a final vote.
The bill is being advanced through budget reconciliation, meaning it can pass with a simple majority and no bipartisan support.
Congressional leaders are targeting July 4th as the deadline for passage.
Read: One, Big, Beautiful Bill: Impact on Philanthropy (Council on Foundations)
One Big Beautiful Bill: Update on Provisions for Nonprofits (Proskauer)
Comparison of Chamber Tax Bills (The Nonprofit Alliance)
May 22: Atlanta Regional Commission estimates that more than $330 million in competitive grants awarded across the metro area are at risk after federal transportation officials announced in March that they planned on reevaluating awards. This includes $150 million toward the first phase of the Stitch, a 14-acre retail and green space over the Downtown Connector, $25 million for the Beltline Northeast Trail, $65 million to connect the Flint River Trail to the Beltline and $30 million for the Central and Pryor safe streets project.
Read: Trump grant rollbacks threaten $330M for metro Atlanta projects (AJC)
June 12: The House has passed a rescission package that proposes to claw back $9.4 billion in previously approved government funding. This package, primarily targeting foreign aid and public broadcasting, is now awaiting action in the Senate. The rescissions are part of a broader effort to reduce government spending and align with the Trump administration's "Department of Government Efficiency" cuts.
Read: House passes rescission package to claw back $9.4 billion in funding for foreign aid, NPR, PBS (CBS News)
House approves cuts package (POLITICO)
June 16: On Monday, a federal judge ruled that the Trump administration’s termination of hundreds of NIH research grants was “void and illegal.” The court found the directives behind the cancellations to be “arbitrary and capricious,” with no legal standing.
Read: Federal Judge Deems Trump Administration’s Termination of NIH Grants Illegal (ProPublica)
Terminated NIH grants must be restored, judge orders (Axios)
Take Action:
Nonprofits are encouraged to speak out about how proposed tax provisions—especially those that limit charitable giving and weaken public safety nets—could affect their ability to serve communities.
Major Tax Package Advances in the Senate! Call Your Members of Congress Today! (National Council of Nonprofits)
Tell Your Senators: Support the Charitable Deduction (The Nonprofit Alliance)
Good News:
Resources:
Our Silence Will Not Protect Us - A recording and transcript of National Council of Nonprofit’s Executive Director Diane Yentel’s keynote speech at Shelterforce’s 50th anniversary event on April 29.
Webinar Recap: What Baltimore Nonprofits Need to Adapt to a Changing Funding Landscape (Baltimore Community Foundation)
A Nonprofit Checklist: What to do When Your Federal Grant or Contract is Terminated (National Council of Nonprofits)
How to Say No to a Grant (Without Burning Bridges) (Nonprofit Nomad)
