Nonprofits at LSA: Charity’s Limits by Luís C. Calderón Gómez

Law and Society Association’s annual meeting is always a great time.  LSA’s mission to look at socio-legal scholarship – to look at “the diverse understandings and practices of people interacting with the domains the law governs” – feel so directly applicable to our work with the charitable sector.  It is, of course, also a great time to catch up with old friends and colleagues and make new ones.

I was pleased to be able to serve as the moderator/discussant for a panel on tax and political economy featuring a number of great speakers. For purposes of this Nonprofit Blog, however, I want to highlight the work in progress presented by Luís C. Calderón Gómez, Assistant Professor of Law at the Benjamin N. Cardozo School of Law.

Entitled Charity’s Limits, this piece builds upon his prior published work Taxation’s Limits, which looked to develop a normative theory that explains the broad outlines of exemptions from income taxation.  That prior work posits that

Rather than conceiving of exemptions as subsidies or individual deviations from a normative base explainable by ordinary politics, this Article argues that exemptions are best understood as mapping the “limits” of tax. These limits are neither arbitrary nor merely a collection of individual subsidies to favored activities; rather, they are best seen as reflective of deeper collective sociopolitical judgments about the scope of the State and the p 
ublic sphere.

As the name indicates, Charity’s Limits focuses in one specific part of the broader scheme of income exemption identified in Taxation’s Limits – charitable exemptions.  In this work, Professor Calderón Gómez applies his Limit Theory more specifically to the charitable sector by applying it in the specific cases of commerciality, the charitable deduction, and in arguably “discriminatory” conduct.  The work in progress states

Unsurprisingly, underlying these deep doctrinal and policy debates lie theoretical problems. These three live policy debates are confused and confusing because they require a convincing explanation of why charities have a tax exemption in the first place. Furthermore, again and again, thinking through these debates requires describing what a desirable relationship would look like among charities, the market, and the State—all different modes of association.

This new article looks at how traditional subsidiary theory does not adequately explain where the boundaries of charity law currently exist and posits that the Limits Theory developed in Taxation’s Limits “provides more determinate and attractive answers to the doctrine problems facing the law” in the charitable tax area. 

Professor Calderón Gómez’s presentation prompted me to rethink some of the historical policy justifications that are easy to take for granted in the charitable area and moved that discussion of alternative charitable theories forward in a compelling and comprehensive way. I look forward to seeing the complete version of this thought-provoking work. In the meantime, you can send inquiries regarding the working draft to Professor Calderón Gómez through his Cardozo law email (luis.calderongomez@yu.edu).

Ruminatingly, eww