Charitable giving up, number of donors down, in first year under Trump’s tax law

Greg Nash

Charitable giving was up 1.6 percent in 2018, but only because of an increase in money from large donations in the first year under President Trump’s tax law, according to a report released Monday by the Fundraising Effectiveness Project.

Revenue from gifts of at least $1,000 increased by 2.6 percent, but revenue from gifts under $250 dropped by 4.4 percent and revenue from gifts of $250 to $999 dropped by 4 percent, according to the report.

{mosads}The report also found that the total number of donors declined by 4.5 percent in 2018.

The nonprofit sector has been closely watching data about charitable giving because of changes to the tax code that Trump enacted in December 2017. Trump’s tax law significantly increased the size of the standard deduction, meaning that fewer people will be claiming an itemized deduction for charitable contributions.

“I think one of the reasons that we’re seeing more larger gifts is that donors had to give more — and have other itemized deductions — in order to exceed the standard deduction threshold,” said Jay Love, chief relationship officer and co-founder at Bloomerang, one of the data providers for the database at the center of the report.

On the other hand, “smaller gifts also fell, as those donors couldn’t take advantage of the charitable deduction anymore,” Love said in a news release.

While the Fundraising Effectiveness Project’s report showed a slight increase in charitable giving, rather than the decrease nonprofits feared, charities are still concerned about the data. The nonprofit sector also expects that it will take several years to fully see how the tax law has influenced charitable donations.

Steve Taylor, a senior vice president at United Way Worldwide, expressed concerns that the increase in charitable giving in 2018 was less than the expected increase in economic growth for the year.

United Way and other charities are pushing for Congress to pass legislation that would allow people to claim the charitable contributions deduction even if they don’t itemize.

“We think that that would really help with what the Fundraising Effectiveness Project numbers show,” Taylor told The Hill.

The Fundraising Effectiveness Project is a project created by the Association of Fundraising Professionals and the Urban Institute. The findings in the group’s report are based on a panel of more than 4,500 charities selected from a database of 161 million transactions.

Tags Charitable giving Donald Trump economy GOP tax law IRS Itemized deduction taxes
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