Charitable Tax Subsidies - Research Paper Example

Most of those employed under these institutions are advocates of rights, developments agendas, or programs upholding general welfare. They are operated for religious, charitable, scientific, testing for public safety, educational purposes, for national or international amateur sports competition, or for the protection of children and animals. They are perceived disinterested with profit, akin to that derived by corporations.

Under Section 501(c)(3) of the United States Internal Revenue Code, non-profit facilities are exempted from taxation especially public charities or private foundations, or private operating foundations. The federal however impose income tax for donors who are responsible for charitable supports (Foundation Group, 2011). Following federal laws, most states allow deductibility for state income tax while other states exempt non-profit facilities from sales tax on purchases and property tax. America’s post office also offers rate postage discounts (FG, 2011 & Boozang, 2010).

Non-profit institutions however are regulated entities and are mandated that none of its net earnings benefit director, officer, or any private individual. Nobody amongst them will benefit too from the distribution of assets if the organization terminates its incorporation (FG, 2011). Workers in these institutions are prohibited to intervene in political campaigns or endorse candidates for public office. Their propaganda and legislative advocacies are advised to be relatively tempered (FG, 2011).  

The institution is also governed by labor laws especially on provisions relating to their health and welfare. Health insurance is among mandatory benefits among employees regardless of whether the company is pro-profit or non-profit (Boozang, 2010). This is essential following studies that one in five Americans hospitalized are placed in an emergency once a year (Dowd, 2010: 10-65). Experiences of those who have undergone emergency room support in times of illness are charged with costly hospital bills and those insured are only reimbursed minimal fees by insurance companies, even if fees underwent negotiated fees (Dowd, 2010: 10-65).  The cost will not classify an individual’s employment background. Under Emergency Medical Treatment and Labor Act, hospitals with medical care and emergency services are mandated to provide medical assistance to any patient, with or without insurance (Dowd, 2010: 10-65). It is also part of the medical professional code that hospitals are forbidden to turn away patients, although it must be realized that everyone must manage financial risk with unpredictable health care costs. This should be considered as the important economic decision to avail health care through insurance, or by paying health services out-of-the-pocket, or by checking account, or by employment-based insurance, otherwise, those who refuse to obtain essential coverage will pay a penalty which will constitute as an addendum to income tax liability (Dowd, 2010: 10-65).

Noting all varied problems relating to health and medication, the American government offer reforms for the Affordable Care Act to regulate health insurance; resolve issues on expensive premiums; maximize employer-based health insurance as part of employee’s compensation; provide financial assistance to support the purchase of coverage for not insured populace under poverty level; and reducing gap through premium tax credits for individuals for poor families or cost-sharing reduction (Dowd, 2010: 0-65).  The act further prohibits insurance companies to cover individuals with the pre-medical condition as well as mandating all Americans to maintain health insurance coverage, even if it's at a minimum level.

For Fleischer (2010), this reform is an illustration of redistributive justice which enables the allocation of resources systematically based on egalitarian principles. Such also regulate non-profit hospitals, but seemingly ran like profit-based corporations, by reviewing their mandates to expand charitable care and social benefit (Kaiser Health News' Daily Report, 2010). In all measures, this is helpful for employees of non-profit institutions in availing of health services and for immediate access to medical relief. Besides, additional income tax liability, they’d better get insurance plans.