Dollars up, Donors down
The doubling of the standard deduction in 2017 meant that far fewer taxpayers would be itemizing their tax deductions. Nonitemizers get no tax benefit from their charitable contributions, and so there was great fear expressed that philanthropy could become a victim of tax reform.
As it turns out, the amount given to charity by Americans has continued to grow, despite the loss of some tax benefits for some families. But according to a new study, these larger dollar amounts are coming from fewer and fewer donors. What’s more, the number of people volunteering their time to nonprofits is also falling. This isn’t entirely attributable to tax incentives, but that may have played a part.
The Generosity Commission was launched in 2021 to examine these phenomena in more detail. In 2008 65.4% of U.S. households donated to a nonprofit organization. Eight years later that figure had fallen to 53% in the wake of the Great Recession. In 2018, the latest year for which the Commission has figures, the proportion dropped below 50%, to 49.6%.
The Bureau of Labor Statistics reported that volunteerism reached a 15-year low of 24.9% in 2015. AmeriCorps reported that the formal volunteering rate fell from 30% in 2019 to just 23% in 2021.
The Generosity Commission believes that a broad base of participation in giving and volunteering is an intrinsic social good to be promoted. Giving and volunteering are a means to create and participate in a pluralistic civil society. They solidify civic engagement and affirm a commitment to work with others toward some larger purpose. They foster social connectedness.
Accordingly, the Commission makes nine specific recommendations in their recent report. You can find the report at https://www.thegenerositycommission.org/report/.
© M.A. Co. All rights reserved.