12:06 GMT04 August 2020
Listen Live
    Get short URL
    0 20

    Individual Americans donated less to charity last year than in 2017, marking the steepest decline since 2009 following the Great Recession, a new report reveals.

    According to a report published last week by The Giving Institute, Americans’ individual giving (adjusted for inflation) decreased by 3.4% from $295 billion in 2017 to $292 billion in 2018, despite a strong economy last year. In 2018, there was a 5% increase in disposable personal income and a 5.2% rise in gross domestic product. 

    However, corporate donations increased by 2.9% last year, while foundation gifts soared by 4.7%. Overall, individuals, bequests, foundations and corporations donated an estimated $427.71 billion to US charities last year.

    “Giving by foundations represented 18% of all charitable dollars given in 2018 - an unprecedented dollar amount and an unprecedented share of total giving. The strong growth in giving by foundations and in giving by corporations helped bolster total giving overall in 2018,” Rachel Hutchisson, chair of The Giving Institute, wrote in a June 18 press release.

    “These results highlight the importance of institutions to the philanthropic landscape, and serve as a reminder that different types of approaches to philanthropy are vital for strengthening and expanding the field, especially in complex years like this one,” she added.

    According to the release, there were many factors that may have affected people’s decisions to donate last year. While personal income experienced strong growth, the stock market decline in late 2018 likely impacted giving patterns. There was also a decline in the number of individuals and households “who itemize various types of deductions on their tax returns” last year.

    “This shift came in response to the federal tax policy change that doubled the standard deduction. More than 45 million households itemized deductions in 2016. Numerous studies suggest that number may have dropped to approximately 16 to 20 million households in 2018, reducing an incentive for charitable giving,” the release explains. 

    Last year, US President Donald Trump’s sweeping tax cuts went into effect for business enterprises and some individuals. The new policy slashed tax rates for companies from 35% to 21%, marking the first major federal tax overhaul in the United States since the 1980s. Although the overhaul decreased tax rates, it also prevented millions of Americans from qualifying for charitable tax deductions.

    “About half of all Americans give, and the tax policy changes may have created uncertainty for some donors, especially those who previously itemized but no longer will,” said Una Osili, PhD, associate dean for research and international programs at the Lilly Family School of Philanthropy, according to the press release. “We have strong historical data about the link between economic variables, the stock market and charitable giving, and we will be analyzing data for the next few years to better understand how broad giving patterns may have changed.”


    Trump Says He'll Dissolve Charitable Foundation to Avoid Conflicts of Interest
    Unexpected Source of Income: Charitable Organization in Italy Funded Daesh
    More Than Half of NY Charitable Donations Go to For-Profit Telemarketers
    New York State Legislature Approves Release of Trump Tax Returns
    Mnuchin Breaks No Law By Refusing to Provide Trump’s Taxes to Congress - Justice Dept
    Donald Trump, tax cuts, charity, United States
    Community standardsDiscussion