July 3, 2013
The economy has hit nonprofits harder than many other entities because when people don't have money to give, organizations can't receive donations. However, a federal tax deduction provided to people who contribute a certain amount to nonprofits has allowed charitable contribution numbers to grow, according to recent data compiled by The Giving USA Foundation and its research partner, the Indiana University Lilly Family School of Philanthropy.
The study revealed giving reached an estimated $316.23 billion in 2012, a 1.5 percent increase when adjusted for inflation from a revised number of $305.45 billion in 2011. Eugene Tempel, founding dean of the Lilly Family School of Philanthropy, said that if donations to grow at this rate, charitable ventures will be able to reach pre-recession levels in less than a decade.
"Overall U.S. charitable giving is on a slow uphill climb – with some bright areas and some that are not as bright," Tempel told The NonProfit Times.
Tax deductions can make it easier to give
Congress and President Barack Obama's administration have thought about potential ways to reduce the tax deductions people receive when they give to a nonprofit, and that is one of the ways reasons Americans donate to certain organizations.
"Philanthropic giving fares best in a known environment, and has been dependent, in part, on certain factors holding true over the decades, including the charitable tax deduction," said David King, chair of the Giving Institute. "The uncertainty among donors created by policy makers' examination of the charitable deduction likely influenced giving in two very different ways in 2012."
Giving to nonprofits increased in 2012
With the tax deduction still in place, individual giving grew nearly 4 percent from the previous year. The government may be wise to look for other instances where they can remove deductions as nonprofits are a worthy cause for many Americans to contribute their money. Many of these people believe donating to organizations is an easy way to get a refund on their taxes. This is especially true for Americans who give larger sums and expect greater deductions from the government.
"Some donors may have 'prepaid' gifts they had intended to make in 2013 to ensure they received a tax benefit," said King.
Ready to chat? Get in touch today to request a no-obligation savings evaluation.
We first started using First Nonprofit’s Unemployment Savings Program when we were a small startup nonprofit. We didn’t have an HR department and needed expertise in the event that an unemployment claim was made. We knew we were eligible to be a reimbursing employer, but weren’t sure how to navigate that process. They made it easy to set things up, plan for, and then manage claims when they came at a very reasonable cost. The amount of time and stress they’ve saved us dealing with all this has been worth way more than the cost. We’ve now grown to a large nonprofit and do have an HR department but have no plans to stop using their services. I highly recommend them to every nonprofit I come into contact with!
Throughout our membership in the Unemployment Savings Program, First Nonprofit understood our demands, community dynamics, and the importance of seamless services; that allowed us to serve our constituents better.
Because INCS advocates for the operating conditions that allow charter public schools to provide high quality public education, partnering with First Nonprofit was an easy decision. First Nonprofit’s unemployment programs provide our member schools two operating elements crucial to their ability to provide high quality public education: savings and budget certainty. Capable, committed teachers are the key to student success. By participating in the unemployment insurance savings plan, charter public schools gain peace of mind and are able to invest more money in their teachers.
It has been our sincere pleasure to maintain a strong, vibrant business partnership with First Nonprofit. We greatly admire their strong industry knowledge, technical expertise, constant professionalism, knowledgeable and dedicated staff. They are always extremely responsive, personable and provide us with the necessary guidance and recommendations on a numerous variety of employment scenarios.
NYCON members who use First Nonprofit’s programs enjoy enduring savings and improved efficiency. Our association knows that success, because from the beginning, we achieved the same great benefits. Great savings, seamless technology, and responsive service. NYCON highly recommends First Nonprofit’s remarkable unemployment solutions.
Visually Impaired Preschool Services has been a client of First Non-Profit since it was first offered as a benefit of VisionServe Alliance. We completed a thorough evaluation of cash savings to our agency before taking advantage of this wonderful benefit and it has been a very wise decision. Our experience with the processes from accounting to claims have been professional, expeditious and easy.
Luckily for us, our interactions regarding any issues with staffing has been very minimal! I can say that all other interactions with regards to billing, 941 reporting, etc. have been extremely pleasant, accommodating and easy to work with. Kim Ghanayem is always prompt, professional and friendly. Thank you so much!
First Nonprofit has been easy to work with and makes the administrative process easier and smoother. We enjoy working with you.