There are some changes happening in the way people donate and how our country's laws affect those donations.
We're going to go into a little detail about the changes you can expect and watch out for in 2019. Read on to see what can be done and how you can hit the ground running this year.
Changing the Standard DeductionThe Tax Cuts and Jobs Act of 2017 doubled the standard deduction in 2018 and numbers are expanding slightly in 2019.
A higher standard deduction could be a cause for anxiety to NGOs and Non-Profits who depend heavily on donations. This is because individuals and families now have less financial incentive to donate for tax benefits.
For example, the standard deduction for families was 12,000 dollars before the 2017 Act. Let's say that a family itemizes 8,000 dollars a year in deductions and donates 5,000 to charitable organizations.
That 13,000 dollars gave the family a 1,000 dollar benefit. Now, that family would take the doubled standard deduction of 24,000 dollars and have less incentive to donate because they're not getting their previous 1,000 dollar benefit.
It's expected that people will practice "bunching" in response to the new standard deduction. This is the process of grouping two or three years of donations into one year, moving the contribution up past the standard deduction. So, if you donated 10,000 dollars a year before, you would skip two years and donate 30,000 to get up past the standard donation.
There's also the chance that the change in standard deductions could result in people giving more money at longer intervals. That being said, the verdict is still out. It isn't known whether, or how the changes will affect contributions. But one thing for certain, we all can and should be doing our part to give back to causes we care about and that's becoming easier with technology.
More Access to Donations OnlineOnline donations accounted for 19.2 billion dollars in 2012. That number grew to 31 billion in 2017.
People are now given the ability to invite their friends on social media to donate to an organization of their choice on birthdays, and crowdsourcing has grown opening more doors for simpler donations.
The internet has changed giving into something that can be done with a few swipes of the finger.
Pledgeling, for example, integrates Apple Pay into donation platforms, making giving extremely easy and accessible. See how simple it can be by trying our technology out:
Simply text APPLEPAY to 707070 and get in touch with us to fuel your fundraising efforts.
Moving ForwardIt's fair to say that changing attitudes toward giving and the ease that technology allows will outweigh the possible effects of changes to the standard deduction.
It's high time to hit the internet full-force with your donation platforms. People are online, and they're ready to give. They're also extremely responsive to mobile storytelling and engagement.
If you're ready to expand and partner with an impact agency, contact us to find out just how big of a difference Pledgeling can make as your donations technology provider. Whatever the size of your business or nonprofit organization, our tools make giving back seemless and simple. If you own a Shopify store, download GIVE & GROW, from the app store, and join the over 3,000 businesses who have integrated donations making it easy to support causes they care deeply about.