🚨Charitable Deduction Reform Could Raise Revenues and Increase Giving We estimate reforms to charitable tax deductions could generate $20 billion while increasing giving, or $115 billion with little impact on giving, based on a new study from the @TaxPolicyCenter. As a result of the OBBBA, there are currently three major charitable tax deductions with different sets of rules. These include: 1️⃣an itemized charitable deduction, with a 0.5% of AGI floor on what giving is deductible 2️⃣an above-the-line deduction, capped at $1,000 per year ($2,000 for married) with no floor 3️⃣a corporate charitable deduction with a 1.0% of AGI floor. CRFB board member @EugeneSteuerle, @Rob_McClelland, and Nikhita Airi of the @TaxPolicyCenter propose merging the two individual deductions into a single Universal Charitable Incentive (UCI) – an uncapped above-the-line deduction with a single percent-of-AGI floor. Using TPC’s estimates as a starting point and applying the same floors to corporations, we estimate a UCI with a 1.5% of AGI floor could generate $20 billion over a decade while substantially increasing individual charitable giving by improving the marginal incentive to give, and a 2% of AGI floor would generate $115 billion with little net impact on individual giving.

🚨NEW: High Inflation Drives 3.6% Social Security COLA Social Security beneficiaries will receive a 3.6% cost-of-living adjustment (COLA) in 2027, based on today’s inflation data. This COLA will be 0.8 percentage points higher than last year’s 2.8% COLA and 0.9 percentage points above what the Social Security Trustees recently projected. With Social Security’s retirement fund less than six years away from insolvency, action will be needed soon to prevent a 22% benefit cut that could wipe out the previous nine years’ worth of COLAs all at once in 2032.

🚨BREAKING: CBO Estimates $2.0 Trillion Deficit for Fiscal Year 2026 The United States borrowed $2.0 trillion in FY 2026, including $28 billion in the month of September, according to the latest Monthly Budget Review from the @USCBO. We expect to hear more details on FY 2026 from CBO next month. The following is a statement from CRFB President @MayaMacGuineas⤵️

🚨CBO Estimates Golden Dome Could Cost More than $1 Trillion Earlier this year, the @USCBO released an analysis estimating the 20-year cost of a National Missile Defense (NMD) system based on President Trump’s 2025 executive order, titled “The Iron Dome for America,” which outlines the basic capabilities and requirements of such a system. While the Administration has not released further details regarding the architecture or components of the NMD system they’re now calling Golden Dome for America, CBO estimated that an illustrative system designed to meet all of the objectives and requirements laid out in the President’s executive order would cost roughly $1.2 trillion to build, operate, and maintain over a 20-year period.

🚨 NEW: U.S. Ran a $2 Trillion Deficit Last Year Fiscal Year (FY) 2026 ended yesterday. Although official figures have not yet been released, our preliminary estimates show high and rising deficits and debt. For FY 2026, we estimate: ➡️ A budget deficit of $2.0 trillion, or 6.2% of GDP. ➡️ Debt held by the public of $32.3 trillion, or 100% of GDP. ➡️ Spending of $7.4 trillion, or 22.9% of GDP. ➡️ Revenue of $5.4 trillion, or 16.7% of GDP. ➡️ Interest costs of $1.1 trillion, a record 3.4% of GDP. ➡️ Interest was the second largest line item in the budget, costing more than defense or Medicare. At $2.0 trillion, we estimate budget deficits were about $210 billion above FY 2025 levels, $135 billion above the @USCBO February projections, and about $305 billion higher than what the Council of Economic Advisers had projected.