It’s the time of year for giving, and every nonprofit knows it. If your mailbox is anything like mine, it’s stuffed this month with requests for tax-deductible donations to countless worthy causes. Any donation I’ve made in response to remembrance requests at a funeral, any contribution I’ve made to a music or cultural nonprofit, any college my children have attended have placed me on their mailing lists for their year-end “asks.”
The requests come against the worrisome backdrop that the mind-numbing fiscal cliff could wind up putting a crimp on next year’s charitable giving. Leaders in nonprofit and philanthropic organizations worry about proposals being floated in Congress and the White House to set a cap on itemized tax deductions or to place a limit on tax benefits to large donors for charitable gifts. The price of averting the serious consequences of a national governmental financial meltdown, in other words, could end up being paid in part by charitable organizations “that enrich our communities and help those most in need,” in the words of Steven Moore, executive director of the Vancouver-based Murdock Charitable Trust.
Those institutions include churches and synagogues; museums and historic sites; emergency responders including American Red Cross and the Salvation Army; sciences and education research organizations; orchestras and arts organizations. Whether the charity is Share or the Fort Vancouver National Trust, Clark County is made whole by their presence.
The consequences to nonprofits of limiting tax deductions are unknown and unknowable as long as proposals lack specificity. Nonprofit advocacy groups, who are predicting a potential drop in charitable donations of $7 billion annually, are preparing for battle with websites stuffed with talking points to make their case to policy-makers.
They have a treasure trove of images of inspiring charitable works to help them make their case: from tiny nonprofits such as Vancouver’s Northwest Association for Blind Athletes to the Community Foundation of Southwest Washington, which receives $5 million to $10 million in donations annually.
At the Community Foundation of Southwest Washington, Executive Director Richard Melching says he doesn’t worry much about the charitable tax deduction. The people he sees give to charities because they see the need, not to secure a tax write-off, he asserts. He notes that taxpayers who aren’t eligible to itemize deductions don’t get a tax break anyway.
Jeanne Kojis, executive director of the Nonprofit Network of Southwest Washington, begs to differ. Yes, she says, ours is a generous community and people do want to give. But a tax deduction is likely to affect just how much some people are willing — and able — to give to charity. Nonprofits have seen contributions wither by billions of dollars during the recession, she says, and can scarcely afford to absorb more cuts during a time of great need.
I’m well aware of the challenges facing social service nonprofits as a volunteer and as husband of the executive director of a nonprofit who is constantly working to raise money. Fundraising can become an all-consuming challenge as those who have the ability to give make their choices between countless worthy causes. Let’s hope that Congress and the president don’t make that challenge even tougher, risking cuts in cost-effective services that are vital to our communities.
Gordon Oliver is The Columbian’s business editor. 360-735-4699, http://twitter.com/col_goliver; http://www.columbian.com/weblogs/strictly-business; or firstname.lastname@example.org.