Bankrupt believers may tithe

Posted: 10/13/06

Bankrupt believers may tithe

By Jason Kane

Religion News Service

WASHINGTON (RNS)—America’s charitable but bankrupt worshippers once again will be able to tithe if Sen. Barack Obama, D-Ill., and Sen. Orrin Hatch, R-Utah, have their way.

“For millions of Americans, charitable giving and tithing is an essential part of their lives,” Obama said. “And in a country where 37 million citizens live in poverty, we should be encouraging charitable giving, not limiting it.”

Last month, a federal judge in New York said bankruptcy reforms passed by Congress last year bar individuals from making charitable contributions if they also are seeking bankruptcy protection.

Obama insisted the bill he and Hatch introduced will clarify that last year’s bankruptcy bill did not change the law “to prioritize creditors over religious institutions and charities.”

He expects the legislation to make its way through the House when Congress reconvenes in November.

In 1998, Congress passed the Religious Liberty and Charitable Donation Protection Act, which allowed individuals in bankruptcy to exempt up to 15 percent of their annual income from creditors for tithing purposes.

That rule largely was undone when Congress passed the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. More than 2 million Americans filed for bankruptcy protection in 2005, and hundreds of thousands are expected to do the same by the end of 2006, according to the National Association of Consumer Bankruptcy Attorneys.