Will recent tax legislation impact future donations to non-profits?

Since added to the U.S. tax code in 1917, charitable deductions in annual tax filings have incentivized Americans to donate to non-profit organizations. Individual donations of cash and goods to non-profits comprise a substantial amount of income today for not-for-profits.

A recent article by the Indianapolis Business Journal asked, “Will Americans decrease the amount of individual donations to non-profits” as a result of the recently enacted cap on itemized deductions?

Indiana University Lilly Family School of Philanthropy suggests that total giving could drop by $13.1 billion, which would be the biggest decrease since the 2007-2009 Recession.

This is the biggest fear for the not-for-profit community, the article reports. They fear fewer people will choose to donate once they don’t see the financial benefit from or don’t need the charitable deduction to reduce their bills. They can instead opt to use the increased standard household deductions.

The impact on non-profits could be significant, but likely won’t be realized until the end of 2018 when donations typically spike.

Read more in the IBJ article.

A new fundraising opportunity for non-profits

Through its cost-reduction engagements with for-profit companies, Silverback provides 10 percent of its fees received from implemented cost savings with a non-profit of the client’s choice.

This could result in a significant donation to the non-profit. Here’s how our program works:

  • We present our business model offering at a board meeting or to a board member’s company
  • The board member’s company engages Silverback in identifying expense reduction opportunities
  • Once savings are realized, we share 10 percent of our fees with the non-profit for as long as they are a client
  • The for-profit is encouraged to match our donation

Contact us to learn more.

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