Magazine article American Theatre

Everybody's Asking

Magazine article American Theatre

Everybody's Asking

Article excerpt

AT THE END OF LAST YEAR, WITH DEC. 31 RAPIDLY approaching, my inbox seemed more full of donation pleas than ever before. New Year's Eve felt more like a "Giving Tuesday" (especially noticeable given that the holiday fell on a Sunday). While year-end is always significant for nonprofits, there was particular urgency around individual giving, since the new tax law and its doubled standard deduction might eliminate the itemizing of deductible expenses for many taxpayers, likely disincentivizing individual charitable giving in 2018 and beyond. Facing that future, some theatres combined their year-end appeal with a message about the new law. For example, American Repertory Theater wrote:

As a friend of the A.R.T., and in light of pending tax changes, I
encourage you to discuss your level of charitable giving with your
advisors. It may be advantageous to pre-pay charitable contributions
in 2017 if you anticipate you will be in a lower tax bracket and/or
not itemizing deductions next year. This may be the right time to
upgrade your support for the American Repertory Theater.

As individuals comprise the largest and fastest-growing segment of giving for nonprofits, the new tax law could hit our field hard, depending on how important that deduction is to our individual donors. The laws are complex, and we don't know yet their precise impact. Today, if you are in the 25 percent tax bracket and itemize on your taxes, you could make $500 worth of contributions for $375 (i.e., you'd receive $125 back at tax time). The new law may mean that some will lower what they give; others may stop entirely; still others, we hope, will simply continue donating. In recent presidential campaigns, large sums have been raised, including from hundreds of thousands of (non-tax-deductible) small gifts. Clearly people will share some of their income for the causes they believe in.

A number of studies delve into the reasons for our unique American spirit of generosity. Every other year, U.S. Trust researches philanthropy among high net worth individuals--defined as those earning more than $200,000 annually and/or with net assets of $1 million or more (exclusive of the value of their homes). In the 2016 study, when asked how their giving would be affected by less favorable tax advantages, 64 percent said they would maintain their giving. In fact, the percentage of those who said they would give regardless of a tax benefit increased from the 2014 version of the study.

Why? Perhaps because this same group of major donors ranks charitable giving and volunteering as the most important avenues for having an impact in society. Seventy-five percent of respondents consider individuals and nonprofits dramatically more effective at solving societal problems than government, so one might conclude they are using their individual wealth, by way of the nonprofit system, to tackle such challenges as education, poverty, quality of life, and the environment. …

Search by... Author
Show... All Results Primary Sources Peer-reviewed

Oops!

An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.