One man's tax incentive is another man's loophole

In order to promote more charitable giving this year, the Katrina Emergency Tax Relief Act lifted the limit on the deduction for cash post-Katrina charitable gifts from the usual 50% to 100% of AGI. And the gifts don's have to be hurricane related. The thinking was, generous donors might have used up their deduction limit already with all of this year's natural disasters. This way, they can keep on giving to their usual charities as well.

Sound like a fair formula for getting the rich to part with their wealth for a good cause? Not to the New York Times— In Hurricane Tax Package, a Boon for Wealthy Donors. This "little-noted" provision is problematic because taxpayers are evidently more enthusiastic about it than expected. Congress thought the revenue loss would be $819 million, but already private estimators have projected a $1 billion to $3.5 billion "cost" to the U.S. Treasury.

To me, that's a sign of a successful tax initiative, but the Times is apparently more worried that some wealthy donors might reduce their tax bill to zero this year, as well as the revenue shortfall. Who favors dynamic revenue scoring now?