Key Panel Seeks to Revamp Charity Tax Breaks

The chairmen of President Obama's deficit commission—in their final plan for improving the nation's fiscal health—today offered a proposal to eliminate the charitable deduction and replace it with a 12-percent tax credit.

However, only people who had donated a certain percentage of their income would be eligible.

The new plan, which is expected to be voted on by the full commission on Friday, proposed changing the charitable tax break as part of a broader effort to simplify the tax code, reduce the deficit, and lower individual and corporate income-tax rates.