Philanthropy 2018: Bad news about good news (and vice versa)
Giving USA report shows effect of Trump tax cut – or does it?
Contributed by AFP SEWI
Milwaukee Business Journal
August 9, 2019 issue
Is your glass half full? Half empty? Thrown against the wall in frustration?
The Giving USA report annually summarizes the nation’s charitable giving. The report on 2018 came out in July, and you can see whatever you want in those tea leaves.
The good news? Americans gave $427 billion to charity last year – the second highest number on record and $17 billion more than 2017. Wow!
The bad news? When adjusted for inflation, overall giving went down 1.7% last year! The downturn was led – ominously – by gifts from individuals (the mainstays of philanthropic giving), who gave 3.5% less when adjust for inflation.
The good news? The decline could have been worse. By increasing the standard deduction, the Trump tax cut decreased the incentive for itemizing and thereby suppressed charitable giving. Some experts thought philanthropy might go down as much as $21 billion, but the effect wasn’t quite that strong. Whew!
The bad news? The experts were right in how the tax change would discourage itemizing. The number of itemizers fell a whopping 66%…
The good news? Seems it was mainly the smaller donors who dropped out of itemizing, because the charitable deductions dropped only 33%...
The bad news? Charitable deductions may slide permanently: as of late May 2019 only 11.3 million taxpayers had itemized, compared to almost 32 million at the same time last year…
The good news? The effect may not be permanent: a volatile stock market in Q4 2018 may have also helped to suppress giving…
The bad news? I have whiplash from continually trying to look on the bright side.
The good news? I’m out of space for this article, so I don’t have to write a definitive conclusion and can just leave you hang…
On Philanthropy appears monthly in the Milwaukee Business Journal for the Association of Fundraising Professionals, Southeastern Wisconsin Chapter. This month’s column is contributed by Doug Diefenbach.