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Nonprofit Staff Development: Not a Nicety, A Necessity

By | All Posts, Commentary, Insights, News You Can Use, Nonprofit Marketing, Organizational + Personal Development, Stewardship, Strategic Planning, Technology, Uncategorized, Volunteers | No Comments

Katie Lord
Vice President

Between technological advances, the rise of the “gig” economy and the transition to a majority millennial workforce, it should come as no surprise that change is happening across all sectors and it is happening faster than we are able to accommodate. This can be especially true when it comes to the nonprofit sector, where I consider our adaptability to change similar to turning the Titanic. While our industry may be a bit slower to adapt than most due to constraints of resources, the best and most sacred resources most of us have is our staff. Our staff has the ability to lead the charge for change within our organization.

We have all seen the classic business quote below of the fabled conversation between a nameless corporate CEO and the CFO:

CFO asks CEO: “What happens if we invest in developing our people and then they leave us?”

CEO: “What happens if we don’t, and they stay?”

This is just as true for nonprofits, especially when it comes to development and volunteer management staff. Nonprofits are known to have one of the highest turnover rates in staff with an estimated 19% annually. According to The Nonprofit Employment Practices Survey by Nonprofit HR, 81% of nonprofits said that their nonprofit organization had no employee retention plan. That is astonishing, especially when you consider how much more cost effective it is to keep your high performing development staff than it is to replace them. How can you keep your top talent engaged and decrease your turnover rate? The answer is simple. Invest in your staff through personal and professional development.

Another finding of The Nonprofit Employment Practices Survey states, “Less than 1% of nonprofit funding has historically gone toward supporting nonprofit talent and only 0.03% ($450M) of the sector’s $1.5 trillion annual spending has been allocated to leadership development.” Let that sink in for a minute. The nonprofit sector accounts for 10% of the GDP and is the third largest employment sector behind retail and manufacturing, yet we don’t invest in our biggest asset of all, our workforce!

Investing in professional development for nonprofit staff is no longer a nicety. It is a necessity, especially when you factor in the traditionally lower salaries that sector employees make compared to their corporate counterparts.  According to a study by Execu-Search, 76% of millennial employees (who are the largest generation in the current workforce) think that professional development is one of the most important aspects of a company’s culture. Below are a few suggestion of how you can offer professional development to your high performing staff that won’t break the budget:

  • Choose a business or career development book and read as an office
  • Bring in a local speaker to talk with your employees about a relevant topic to your mission
  • Reimburse or pay for membership in a professional development association
  • Allow staff to take a webinar or attend a seminar once a quarter
  • Have staff select one conference every other year to attend (many provide financial assistance or scholarship opportunities)
  • Encourage your staff to volunteer to serve on boards (Believe me, it gives your staff member an invaluable perspective to be on the other side of the table) and allow flex time for your staff to do so
  • Hire a coach for first time managers or for those you see with leadership potential

It is important for us as a sector to not shy away from investing in our staff’s development. It is our staff who run our programs and who work tirelessly to fill the gaps in our society left by both the public and private sector.  By not providing employees with professional development, we risk continuing to be slow to adapt as a sector and thereby losing our most promising talent and future change makers to others who will allow them to grow.

Economic Trends, Philanthropy and Civil Society: Dr. Patrick Rooney and Giving USA 2018 in Kansas City

By | All Posts, Annual Giving, Capacity Building, Commentary, Current Events/News, Donor Cultivation, Fundraising, Giving USA, News You Can Use | No Comments

Dr. Patrick Rooney
Executive Associate Dean for Academic Programs and Professor of Economics and Philanthropic Studies at the Indiana University Lilly Family School of Philanthropy

On June 15, JB+A welcomed Dr. Patrick Rooney, Executive Associate Dean for Academic Programs and Professor of Economics and Philanthropic Studies at the Indiana University Lilly Family School of Philanthropy, back to Kansas City for his 13th year of presenting Giving USA.  This year’s report was presented as part of the 501(c)Success National Speaker Series program of Nonprofit Connect, sponsored by Jeffrey Byrne + Associates and U.S. Trust.

Powered by a booming stock market and a strong economy, charitable giving by American individuals, bequests, foundations and corporations to U.S. charities surged to an estimated $410.02 billion in 2017, according to Giving USA 2018: The Annual Report on Philanthropy for the Year 2017. In addition to his presentation covering the sources and recipients of giving (check out the 2017 charitable giving numbers here). Dr. Rooney provided insights about five key areas that impact philanthropy:

  1. Civil Society
  2. Tax Policies
  3. Disaster Giving
  4. Donor-Advised Funds
  5. Generational Giving
  1. Civil Society
    We’ve heard it before from Dr. Rooney:  more people give than vote, and that trend hasn’t changed. A study found that in every presidential election year (for which there is data), more Americans have donated than voted!  As the world of politics becomes more and more turbulent, don’t lose sight of the role charitable giving plays. In some cases, changes in public policy or budgets actually drive giving (think ACLU for example, or “rage giving”.)  But these reactionary gifts haven’t quite “moved the charitable giving needle” overall.
  2. Tax Policies
    Dr. Rooney addressed the misperception that people donate because of a tax deduction. He pointed out the irrationality of that behavior (if someone only cared about himself he would never give, because one is always in a better fiscal position by NOT giving away money). BUT, theoretically anyway, a tax deduction lowers the “cost” of giving (the after-tax price) and consequently, eliminating the tax deduction increases the cost of giving.  Dr. Rooney’s research concluded a 35% tax rate and an increased standard deduction would reduce charitable giving by more than $13 billion, and that didn’t include impact from dropping corporate tax rates or doubling the exemption for the estate tax. The research also noted that adding an expanded charitable deduction would increase charitable giving by $4.8 billion. Bottom line, tax and fiscal policy decisions impact charitable giving and the nonprofit sector.
  3. Disaster Giving
    Does giving to disasters usurp giving to other sectors? This is an understandable concern, given the phenomenal response we’ve seen over recent years to both domestic and international disasters.  But Dr. Rooney reassures us that research indicates there’s not significant displacement: gifts to disaster response average $50 and are in high quantity immediately following a disaster but tend to (but not always) taper off with time and as media coverage shifts away from the disaster. Studies support that there are no permanent effects on giving – to either disaster relief organizations or other charities.
  4. Donor-Advised Funds
    The dialogue and debates surrounding Donor-Advised Funds (DAFs) seem endless – but for better or worse, DAFs are here to stay (DAF asset values have more than doubled between 2010 and 2015, from $33.6 billion to $78.6 billion) and are likely to become even more popular with the doubling of the standard deduction, given they are a useful way to “bunch” gifts in a year and maximize tax deductibility. DAFs are often the recipients of “liquidity moments” – meaning, donors can easily place their resources into a DAF and then allocate gifts through the DAF to charities over a period of time.Dr. Rooney cautioned against assuming all gifts to DAFs would have been made directly to either public charities or private foundations if DAFs were not available.  He reminded us all DAFs end up in charities eventually (for example, commercial holders of DAFs have policies in place to ensure funds are donated from “dormant” accounts after a set period of time) and are really permanent commitments to philanthropy.  It’s still unclear if/the extent to which DAFs cause displacement or reallocation of giving.
  5. Generational Giving
    Dr. Rooney shared observations on generational succession in American giving and stressed the importance of understanding differences by generation.  The Greatest and Silent generations (born before 1945) had a sense of common purpose, a high confidence in institutions and were active in civic participation. They overcame the Great Depression and World War II and created Social Security. These generations had a larger percentage of families who gave large amounts than later generations.Boomers, GenXers and Millennials (all born after 1946) place a higher emphasis on autonomy, have a lower confidence in institutions and demonstrate less empathy.  These generations also participate less in formal religion and experienced more political and economic scandals.  These generations have a smaller percentage of families giving large amounts than the Greatest and Silent generations, but among these generational families who do give large amounts, the level of giving is higher than or similar to the level of previous generations. Dr. Rooney stated a critical statistic is that donors are down, and dollars per donor are up but starting to slip. He stressed it seemed unlikely we would increase total giving by applying more pressure to existing donors – rather, we need to have a clearer understanding of why donors are down and better grasp gender differences by generation.

Remaining aware of the deeper variables that impact giving will help us understand our donors and prospective donors better, and enable us to build stronger relationships with them – ultimately improving the overall outcomes of philanthropy, and most importantly, improving our communities.

Giving USA: Interesting Reading or Fundraising Guide?

By | All Posts, Annual Giving, Capacity Building, Commentary, Current Events/News, Donor Cultivation, Fundraising, Giving USA, News You Can Use, Organizational + Personal Development, The Giving Institute | 2 Comments

Jeffrey D. Byrne
President + CEO

We’re approaching that most wonderful time of the year: Giving USA 2018: The Annual Report on Philanthropy for the Year 2017 is on the horizon. We’re ready to welcome Dr. Patrick Rooney back to Kansas City as he gives us that coveted first look at giving data for 2017 and provides critical observations and interpretations about the state of philanthropy in the U.S. This will be our 13th year of presenting the report with Dr. Rooney in Kansas City, and I am proud of our partnership and friendship with this nationally-recognized (and fun!) expert on philanthropy.

It’s no secret I’m a fundraising “nerd,” and so many questions come to mind as I eagerly anticipate the release of our most trusted and comprehensive annual giving report: Will charitable giving rise for the fourth straight year? How did rage giving and tax reform affect philanthropy? Will the other recipient sectors continue to close the gap on or even surpass giving to religion? How did the economy impact giving?

But here’s the most important question about Giving USA to consider:  How can nonprofits use the report to improve their fundraising?

Don’t treat Giving USA the way some organizations treat their strategic plan and simply place the report on a shelf as you go about your daily routine. Read the report.  Understand the report.  Share the report.  Refer back to the report.  Make changes to fundraising strategies based on the report.  At JB+A, everyone carries a copy of Giving USA (perhaps my good habits ARE rubbing off on others)and we make notes, discuss the trends, identify nonprofit sector needs, successes and failures, evaluate our clients’ fundraising progress and brainstorm new strategies and tactics to improve fundraising.  Remember that great American Express ad campaign, “Don’t leave home without it”?  The same goes for Giving USA.

Here five ways Nonprofits can use Giving USA to improve their fundraising:

  1. Understand the correlations between giving and economic factors
    The stock market, personal wealth, personal income, GDP, corporate pre-tax profits and unemployment rates impact giving by all four sources (individuals, foundations, bequests and corporations). Trends are closely monitored by people “inside” and “outside” the philanthropy sector. Be aware of changes in these indicators, anticipate how changes will impact donors and adjust fundraising strategies accordingly.
  1. Confirm or dispel myths about giving
    Economic and political scenarios, complex societal issues, diverse giving platforms, wealth and capacity are just some of the drivers behind philanthropy. Understand the context of these drivers, help manage expectations about giving and set realistic and achievable goals for your fundraising plans.
  1. Educate Board members, volunteers, donors and staff about the broad context of philanthropic giving
    Help stakeholders better understand your organization’s funding patterns and potential. This isn’t so much about “keeping up with the Joneses of fundraising” but rather, what can we learn from their success and what can (or can’t) we emulate?
  1. Be nimble in your fundraising and stewardship
    Nonprofit fundraising must evolve as philanthropy evolves.  We are seeing an increase in the popularity of non-traditional giving vehicles (such as donor-advised funds and non-cash assets) and donors want more evidence of the impact of their gifts. What do your donors expect? Listen to your donors and prospective donors – and tailor your strategies to match their needs and expectations.
  1. Recognize the “individual giving effect”
    An estimated 87% of total giving in 2016 came from individuals, bequests and family foundations. There are human beings involved in every gift, and unfortunately sometimes, we forget this. Focus on developing and maintaining meaningful relationships with not simply the “concept of donor” but on an individual basis…with Bill and Marcia, with Joe and Liz, with Emma, with Peter and with Shane.

One last thought: Americans give an average of more than $1 billion a day to help others. So, you can also use the report to remind yourself (and others): nonprofits are doing very important work.  Good job.

Be sure to register now for the 501 (c) Success National Speaker Series Giving USA 2018: The Annual Report on Philanthropy for the Year 2017 with Dr. Patrick Rooney.  Details are below.

Friday, June 15, 2018
7:30 – 9:00 AM
7:30 a.m. – Breakfast | 7:50 a.m. – Program
Kauffman Foundation Conference Center
4801 Rockhill Road
Kansas City, MO 64110

Love your Volunteers. Really.

By | All Posts, Commentary, News You Can Use, Volunteers | No Comments

Veronica Gerrity
Coordinator of Administration + Consulting

April 15th through the 21st was National Volunteer Week in the US, powered by Points of Light, the world’s largest organization dedicated to volunteer service. This special time gave nonprofit organizations the opportunity to remember the great works accomplished by their volunteers.

Established in 1974 and growing steadily ever since, National Volunteer Week has grown exponentially each year. The repeated success of this celebration proves honoring the impact of volunteers in our communities will inspire others to serve. JB+A has come up with 10 creative ways to say thank you to your volunteers year-round and show these unpaid, yet highly productive workers for your organization how valuable they and their contributions really are:

  1. Shout it Out – give a public shout out to your rockstar volunteers on your website, Facebook, Twitter or newsletter. Highlight specific volunteers and shine a light on their hard work and the impact they have on your organization.
  2. Let Them be Creative – Do your volunteers wear an organizational t-shirt? Hold a contest to let your volunteers design it. This helps volunteers feel creative and empowered – and really increases wardrobe options for your long-time volunteers.
  3. Share a Gift of Love – Ask those served by your nonprofit to craft personal gifts (letters, art work, poems, pictures from past events) to give to treasured volunteers.
  4. Volunteer Hall of Fame – Have an empty wall in the office? Create a Volunteer Hall of Fame and post pictures of each volunteer. Highlight a new “inductee” each month or quarter.
  5. Have Them Say It – Invite volunteers to share personal stories about why they volunteer and special experiences with your organization, then feature those stories in your newsletter, on your website and social media and on the Hall of Fame wall.
  6. Flexibility is King – Have a volunteer who is always reliable? Show your appreciation by giving them first dibs on working desirable projects or offer more flexibility in their volunteer schedule.
  7. Meet and Eat – Treat your volunteers to a meal with the people who appreciate their time the most – your clients and their families, staff and Board members. Yum.
  8. Remember the Person – Keep records of volunteers’ birthdays and send them a card. Did you hear about a major accomplishment or life event (graduation, new job, wedding or birth etc.) with a volunteer? Send them a quick note and let them know your organization is proud to be a part of their lives.
  9. Make Them Laugh – Have extra candy lying around? Create “punny” thank-you messages and add some candy to surprise your volunteers when they walk in. Sometimes the silliest way to say thank you is the one that will stick.
  10. Show Them the Love – Create an online photo album showing the work your volunteers have contributed over the last year. The visual impact of seeing their accomplishments is a great way to reinforce your organization’s appreciation.

Lastly, remembering to simply say “thank you” and remembering to say it often is sometimes all anyone needs to hear to reaffirm their commitment and love for your organization. Taking the time to be sincere and making each occasion to recognize volunteers meaningful will allow your organization to achieve more and be better.

Cast from the vision of 1,000 points of light shared by founder President George H. W. Bush in his 1989 inaugural address, Points of Light helps mobilize people to take action on the causes they care about through innovative programs, events and campaigns.

Why Major Gifts? Why Now?

By | All Posts, Capacity Building, Commentary, Database Management, Donor Cultivation, Fundraising, Major Gift Solicitation, Prospect Research | No Comments

How many of us wish there were more hours in the day to focus on our major giving program and donors? Some of us may be one-man teams, but even those of us lucky enough to work in a fully-staffed, robust development office wish we had more time to reach out to more donors and have more meaningful conversations. Some of us don’t work on major gifts because there isn’t time and we don’t really see the need: “Why would I spend the time on major gifts if I’m getting by with annual gifts, grants, earned income, etc.?”

Good question. And below is arguably a good answer.

First, let’s reference GivingUSA: The Annual Report on Philanthropy published by The Giving USA Foundation, an arm of The Giving Institute. Of the approximately $390 Billion dollars given by Americans in 2016, 72% was given by individuals.  Add in the 8% giving through bequests (which are also given by individuals, technically) and the 7% from family foundations and the total is closer to 87% received from individuals.  That leaves only 13% given by foundations and corporations. Also, foundations are only legally required and mostly stick to a 5% mandatory distribution requirement.

Donor-Advised Funds and non-traditional giving methods allow for a myriad of possibilities and vehicles for individuals to use to invest in causes and programs about which they care deeply. It is also easier and a better use of staff resources (including time!) to cultivate and grow donors you already have, than to go out and identify new donors.  This is especially true when you look at the national statistics on donor retention. The 2017 Fundraising Effectiveness Survey Report found donor retention year-over-year averages 45%, meaning more than half of your new donors will not give a gift a second time.

A major giving program gives your donors a path to a deeper relationship with your mission and allows for greater impact through financial investment. With donor acquisition costs on the rise,  spending time examining your current donor base is a better use of time and results in a higher ROI. These individuals have already self-selected and said “yes” to you and your work at least once, but how well do you really “know” them? When was the last time your organization (or have your ever?) conducted a wealth screening? You may know who your top donors are, but do you know who are your most loyal?

To implement a major giving program, organizations should rely on the four pillars of a successful solicitation:

  1. You need a major giving case for support that clearly explains your mission and needs and expresses the impact major giving investments will have on your nonprofit.
  2. It’s imperative that we really “do our homework” and know our donors by understanding their past support, motivations to give and philanthropic goals. This is where the art and science of fundraising converge at the intersection of qualitative and quantitative knowledge.
  3. Utilizing this knowledge, we can develop personalized cultivation strategies, guided by best practices, to present the strongest solicitation possible.
  4. We need to steward our donors by identifying meaningful recognition and continuing communication.

By now, I hope you you’re thoroughly convinced individual donor prospects and major giving are elements you need in your resource development plan.  But do you still wonder if you have the time and resources to implement a major giving program your own organization?

Well, you can quit wondering.

JB+A is pleased to present a solution, in partnership with Softerware, Inc.: DonorPerfect Consulting Services Powered by Jeffrey Byrne + Associates is a 12-month, one-on-one phone and web-based consulting service that will help your organization institute major giving best practices and will offer advice crafted for each organization’s unique needs.  Expert coaching provided by us (JB+A) while utilizing DonorPerfect software and DonorSearch wealth screenings will help you identify and achieve your organization’s major giving fundraising goals.

Want to learn more?  Give me a call at 816-237-1999 or email me at KLord@FundraisingJBA.com.

Philanthropy is Business…and That’s OK

By | All Posts, Boards + Leadership, Capacity Building, Commentary, Fiscal Management, News You Can Use, Organizational + Personal Development, Strategic Planning, Uncategorized | No Comments

As we close out another year with the turn of the calendar to January, many of us spend some time reflecting on the lessons learned over the past 12 months while setting organizational goals for the year ahead.  We need to take the time, not only to do this on a personal and organizational basis, but as a profession.  I think it is important that as a sector we take stock of where we have been, where we are and where we need to go in order to stay nimble – while continuing to increase our meaningful societal significance.  We can all agree that the times they are a changing.

As we continue to march our way through the second decade of the new millennium, the nonprofit sector looks much different than it did even two years ago, let alone in 2000.   Technological tools, data analytics, interpersonal communication options, physical work environments and service delivery are just a few of the ways our work world is rapidly changing. Corporations are now focused on social enterprise; the conversations and perceptions of how they make social impact are changing.  Are we as a sector ready for this?

Unfortunately, the nonprofit sector is not always known for its adaptability or quick response to change.  Misguidedly, we often reject the idea of “running a nonprofit like a business” which causes our sector to be perceived as accepting a “status quo” or “this is the way we have always done it” mentality.  This also reinforces the expectations of “minimal overhead ratios,” “outputs vs. outcomes” and the proverbial misperception that we need to be “saved” by the for-profit sector.  Not surprisingly, this continues to cause tension and maintain an undercurrent of lack of respect and frustration felt by us as the practitioners of social good.

“Failure” is still a bad word among our sector and is not celebrated as a learning experience, as it is with our corporate counterparts, due to how funding for such projects is obtained.  With few dollars available for venture philanthropy, the competition is fierce, limiting the ability for innovative solutions to be discovered and rapidly implemented across subsectors.

My hope for 2018 is that we as a sector begin to be as recognized for our specialties, expertise and impact as our for-profit counterparts. I hope we embrace the fact that at the end of the day, we too are in business – the business of doing good for our community, country and world.  Our work is vital to the economic and social success of our county.  We are the second largest employer behind manufacturing. Our products are safe housing options, research to find cures for disease and hot meals for the homeless.  Our services include removing barriers to education and job skills training, mentorship, mental health programs and youth interventions.

How can this mentality be implemented in our nonprofit organizations this year? Let’s walk before we run.  Invest in team training on business skills, contribute to cross sector conversations, attend networking events, read traditional “best business practices books” and implement key ideas, have a Board focus group to discuss and update strategic plans.  Set one, three- and five-year program and fundraising goals. Seemingly small steps can make big results for our stakeholders and those we serve. Let’s seize the opportunity to do business in 2018, but not as business as usual!

Moving the Needle: What Might Be Possible for Philanthropy in America?

By | All Posts, Commentary, Current Events/News, Fundraising, Giving USA, Legislative + Advocacy, The Giving Institute, Uncategorized | No Comments

Leaders in the nonprofit and fundraising sector are gathering soon, through an effort spearheaded by The Giving Institute, to begin developing a plan to help increase charitable giving in America.

American individuals, estates, foundations and corporations contributed an estimated $390.05 billion to U.S. charities in 2016, according to Giving USA 2017: The Annual Report on Philanthropy for the Year 2016. Total giving rose 2.7 percent in current dollars (1.4 percent adjusted for inflation) over total giving in 2015, and giving to all nine major categories of recipient organizations grew, making 2016 just the sixth time in the past 40 years that this has occurred.

This growth in giving is good.  Yet total giving as a percentage of Gross Domestic Product (GDP) continues to hover around 2.0 percent as it has for the last six years. So, The Giving Institute is coordinating discussions about a national plan to “move the needle.”

JB+A President + CEO Jeffrey Byrne, who served as Board Chair of The Giving Institute from 2015-2017, is among several nonprofit thought leaders who are part of an initial “working committee” to start dialogue about an examination of giving practices and how to increase giving while incorporating input from several people from several sectors (nonprofit, government, corporate, etc.)

Approximately two dozen people will be meeting in Dallas on February 7 to continue developing components of the plan:  focus of the work, organization as a legal entity, potential leadership and staffing, funding, research, information dissemination, federal recognition, communications and building support.

This national examination of giving practices is similar to “The Commission on Private Philanthropy and Public Needs” in 1973-1975, most commonly known as “The Filer Commission.” This historical effort was spearheaded by John Filer, chairman of Aetna Insurance, and initiated by John D. Rockefeller, III, after the Tax Reform Act of 1969 was passed.  The Commission’s report, “Giving in America,”  contained recommendations that fell into three categories: 1) proposals involving taxes and giving, 2) interaction among donors, recipients and the public – those who affect the philanthropic process and 3) a proposal for a permanent commission on the nonprofit sector. The commission scrutinized government inducements to giving and considered alternatives such as tax credits and matching grant systems. Members felt the charitable deduction should be “retained and added on to rather than replaced by another form of governmental encouragement to giving.”

There were six main objectives for the commission’s final report: 1) increase the number of people who contribute significantly to and participate in nonprofit activities, 2) increase the amount of giving, 3) increase inducements to giving by those in low- and middle-income brackets, 4) preserve private choice in giving, 5) minimize income loss of nonprofit organizations that depend on the current pattern of giving and 6) be as efficient as possible (meaning, the new levels of  contributions stimulated should at least approximate the amount of government revenue foregone in order to provide this stimulus.) thought leader and participant in this critical/revolutionary time for philanthropy.

JB+A is excited to be part of this exciting and pivotal time for philanthropy – and discovering what might be possible for philanthropy in America in the years ahead.

*Giving USA: The Annual Report on Philanthropy in America, has produced comprehensive charitable giving data that are relied on by donors, fundraisers and nonprofit leaders. The research in this annual report estimates all giving to all charitable organizations across the United States.  Giving USA is a public outreach initiative of Giving USA FoundationTM and is researched and written by the Indiana University Lilly Family School of Philanthropy. Giving USA FoundationTM, established in 1985 by The Giving Institute, endeavors to advance philanthropy through research and education. Explore Giving USA products and resources, including free highlights of each annual report at its online store at www.givingusa.org for more information.

Tax Reform is Here, but without the Universal Charitable Deduction

By | All Posts, Annual Giving, Boards + Leadership, Commentary, Current Events/News, Fundraising, Legislative + Advocacy, News You Can Use, Strategic Planning | No Comments

Through its membership in The Giving Institute (our President + CEO Jeffrey Byrne served as Board Chair for two years) JB+A is a member of the Charitable Giving Coalition (CGC). Below is the statement from the CGC on the final tax reform bill. Join the CGC in reaching out to your Congressional Representatives and U.S. Senators to let them know of the positive impact the charitable deduction has on philanthropy and your organization. 

12/20/17 – CGC DISAPPOINTED CONGRESS FAILS TO ENACT UNIVERSAL CHARITABLE DEDUCTION IN REFORM; VOWS TO CONTINUE PUSH IN 2018

As Congress moves to enact tax reform legislation, lawmakers are failing America’s charities. Instead of preserving a tax incentive that for the past century has helped build a strong and vibrant charitable sector, the final tax reform bill effectively eliminates the charitable deduction for 95% of all taxpayers, dealing a harsh blow to organizations on the frontlines of serving those most in need.

In real terms, more than 30 million taxpayers will no longer be able to deduct their charitable gifts, which will translate to a decline of more than $13 billion in charitable contributions annually. This decline represents between 4% and 6.5% of contributions according to studies by Lilly Family School of Philanthropy at Indiana University and Tax Policy Center.

Along with leaders from charities across the country, the Charitable Giving Coalition has spent the past year urging members of Congress to address the negative impact on giving that will be triggered by increasing the standard deduction. Several Republican and Democratic lawmakers recognized this reality and its negative consequences. Unfortunately, despite clear and convincing evidence that the plans as introduced will reduce giving, the final tax bill does not include a “fix,” such as a universal charitable deduction for all taxpayers who will take the standard deduction. A universal charitable deduction would not only help recoup the anticipated loss of charitable contributions, but would also promote fairness by allowing all taxpayers to deduct their contributions.

The CGC recognizes that the final tax reform bill maintains the charitable deduction for the limited number of taxpayers who will continue to itemize. The bill also makes two positive adjustments for those taxpayers. First, it allows itemizers to deduct charitable contributions of cash up to 60% of their adjusted gross income (AGI), increasing that limitation from the current 50% level. Second, it repeals the Pease limitation, which had reduced the value of itemized deductions for higher income taxpayers.

While these changes are positive adjustments for the charitable deduction, they will, in no way, make up for the limited availability of the charitable deduction and the loss of billions of dollars in charitable contributions annually.

The stark reality for most charities is that, as government budgets continue to shrink, especially for social services and other programs that benefit communities, charitable contributions are a critical lifeline. Given this reality, it is extraordinarily short-sighted to limit incentives for private contributions to charity. Charitable contributions and the charitable tax deduction are critical for organizations doing vital work in our communities, particularly the small, local charities and congregations already being run on a shoe-string budget that are likely to be hardest-hit by reduced giving. Losing 4-6.5% of their annual budgets will be devastating to these charities and to the vulnerable communities they often serve.

The CGC is deeply committed to pursuing a universal charitable deduction when Congress reconvenes in 2018. In recent months, a groundswell of support has grown among both Republicans and Democrats in the Senate and House. Several members demonstrated they understood the implications on charitable giving of tax reform proposals. And, they acted, introducing both legislation and amendments during consideration of the tax bill. The CGC is deeply grateful for Members’ outspoken support and will build on this momentum to expand the charitable tax deduction to all American taxpayers.

To learn more about the CGC, visit protectgiving.org

See more analysis of tax reform from Dr. Patrick Rooney with the Lilly Family School of Philanthropy.

Response from the Charitable Giving Coalition to H.R. 1, The Tax Cuts and Jobs Act

By | All Posts, Commentary, Current Events/News, Legislative + Advocacy, The Giving Institute | One Comment

Through its membership in The Giving Institute (our President + CEO Jeffrey Byrne served as Board Chair for two years) JB+A is a member of the Charitable Giving Coalition.  We will continue to carefully monitor the progress of this proposed legislation as it winds its way through the halls of Congress, and will continue to keep you updated. There’s obviously a lot at stake, and we need to stay abreast of these public policy issues.

 Consider sharing these updates with your senior executive team, your entire fundraising staff and your Board of Directors. Reach out to your Congressional Representatives and U. S. Senators to let them know of the positive impact the charitable deduction has on philanthropy and your organization.  Keeping elected officials informed on the positive impact of legislation within their districts is critical to persuading Congress to pass a permanent version of this proven charitable giving incentive. 

As the current Administration and Congress continue to propose various options for tax reform, we know these changes will affect charitable giving and the nonprofit sector. The latest tax reform framework was released last Wednesday, November 1, in H.R. 1, The Tax Cuts and Jobs Act. What are the potential consequences of this proposed legislation on America’s charitable organizations and those they serve?

The Charitable Giving Coalition (CGC), (a group of more than 175 diverse organizations representing private and community foundations, their grantees and independent charities, as well as nonprofit organizations and the associations and umbrella groups) is dedicated to preserving the charitable tax deduction – crucial to ensuring our nation’s charities receive the funds necessary to fulfill their essential philanthropic missions.

The CGC provides a unique and unified voice on Capitol Hill, and recently released a statement outlining its concerns that The Tax Cuts and Jobs Act (H.R. 1) will generate dramatic and negative consequences for America’s nonprofits and their constituents.

This proposed revision to the tax code doubles the standard deduction and shifts millions of taxpayers who currently itemize to taking the standard deduction. As many as 30 million taxpayers who itemized in 2016 would no longer have access to charitable giving incentive and would be taxed on their gifts.

While the CGC is grateful that H.R. 1 retains the charitable tax deduction for those who itemize, it articulates that “the result of this provision alone could be a staggering loss of up to $13.1 billion in contributions annually, undermining America’s charitable organizations and our country’s extraordinary tradition of philanthropy. The charitable deduction would be available to only 5% of all taxpayers – causing this significant drop in contributions. Up to 95% of taxpayers will be taxed on their gifts to charity.”

As an alternative to H.R. 1, the CGC offers a resolution it feels is fair and efficient and will continue to encourage Americans to donate to charities:  a universal charitable deduction available to all taxpayers. The CGC believes that continuing to incentivize the deduction for charitable giving would offset anticipated losses and potentially gain an additional $7billion annually for America’s charitable organizations while encouraging younger taxpayers to begin charitable giving earlier.

Read the full press release from the CGC here.

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