New Income Tax Provision Could Slash Charitable Giving by $19 Billion a Year, Report Says

Will some of the provisions included in the 2017 federal income tax overhaul, which reduced the number of households that itemize deductions on their income tax returns, significantly reduce individual charitable giving? A just-released study found that the revised tax law, the most significant overhaul of the tax code in decades, could cut the number of households donating to charity by 2.6 million per year and reduce charitable giving by up to $19.1 billion per year through 2025.

These changes could possibly accelerate the long-term decline in the share of U.S. households that donate to a nonprofit. In 2000, 67 percent of American households donated to nonprofits, but in 2014, only 56 percent did.

The report also examined five specific policy options under consideration by the nonprofit sector.

The study, titled “Charitable Giving and Tax Incentives,” was commissioned by Independent Sector, a Washington DC-based group that advocates on behalf of nonprofits. It was written and researched by Indiana University Lilly Family School of Philanthropy. It is available here.


This text is provided with the understanding that ECFA is not rendering legal, accounting, or other professional advice or service. Professional advice on specific issues should be sought from an accountant, lawyer, or other professional.


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