Voluntary fund contributions on Massachusetts income tax return form

Boston Statehouse

Massachusetts Resident Income Tax Return (Mass.gov Screenshot)

BOSTON (SHNS) – Every year when Massachusetts residents fill out their state income tax forms they have the option of checking one or more of six boxes and making a voluntary contribution to causes like wildlife conservation and military family relief.

But where that money goes, according to one senator, is not always clear.

Sen. Michael Barrett, a Lexington Democrat, has filed a bill that would add a new option for taxpayers to give to a United Nations fund supporting developing countries vulnerable to climate change. But he’s also calling for a more regular review of the existing options taxpayers have to make donations through their tax filings.

Barrett’s bill (S 1796) would add a seventh box to the tax form allowing residents to contribute to the UN’s Least Developed Countries Fund to support poor countries in developing parts of the world respond to threats from climate change.

“This would be the first of it’s kind in the country,” Barrett said.

The senator’s bill, however, would also require annual reporting of how all voluntary contributions are distributed and direct the auditor to review each program at least once every five years. For instance, Barrett said his office attempted to find out how money contributed to an Olympics fund to support athletes from Massachusetts has been distributed, but failed.

Other money, he said, gets funneled into state agencies like the Department of Public Health for HIV prevention and the Division of Fisheries and Wildlife for conservation efforts.

“These are not nonprofits,” Barrett said. “It bothers me a little bit that four of the six are backdoor funding mechanisms for state agencies.”

The six boxes on the state income tax form allow for contributions to be made to support endangered wildlife conservation, organ transplants, a Massachusetts Public Health HIV and Hepatitis Fund, a Massachusetts U.S. Olympic fund, Massachusetts military family relief, and homeless animal prevention and care.

Barrett said the homeless animal fund and military families tend to be the most popular options.

Rep. Antonio Cabral, who filed a version (H 2883) in the House, and Rep. Christine Barber joined Barrett in testifying Wednesday in support of the bill, which they said received a favorable recommendation from the Committee on Revenue last session.

Rep. Adam Hinds, the co-chair of the committee, thanked Barrett for drawing his attention to the issue, noting his local interest as Charlemont alpine skier Paula Moltzan prepares for this winter’s Olympics in China.

“I’ll be making some noise about that,” Hinds said.

Barrett said that between 2012 and 2015 the number of tax filers donating to the Olympic athlete fund dropped from 9,062 to about 8,100, before ticking back up to 8,800 in 2016, which was an Olympics year.

His and Cabral’s bills would set thresholds moving forward for the tax-return enabled contributions to remain on the forms, including a requirement that the option generate contributions totaling at least 80 percent of the average contribution to all options on the tax form in at least one of the preceding five years.

The bills would also limit the options available for giving to no more than nine options and no fewer than three.

“The idea is to freshen up the list so people have the option to give to causes that they feel deserve the most attention,” Barrett said.

The Committee on Revenue held a hearing on Wednesday on 52 bills related to estate and personal income taxes, including Hind’s proposal (S 1883) to pilot a universal income program for 100 families that would tap local businesses, nonprofits and foundations to provide participants with $1,000 a month and measure the impact on their lives.

“It’s a concept I think is worth exploring,” Hinds said.

The committee also heard testimony on ways to reform the state’s estate tax and proposals to expand the size and reach of the state’s earned income tax credit to benefit more families.

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