Celebrating a Century of Charitable Deductions
As American generosity grows, how should Church leaders respond and engage members?
Exactly a century ago, Congress ushered in a seismic change that ushered in the transformation of U.S. philanthropy: for the first time, charitable gifts would become tax deductible. Knowing that the financial strains of World War I would make charitable giving more difficult, they found a way to reward individuals and families who chose to donate money for the public good. Our history with charitable deductions provides a continuing opportunity to engage church members in supporting our mission and embracing Christ-like generosity.
Last year American individuals, estates, foundations and corporations set a new record high by contributing an estimated $390.05 billion to U.S. charities, according to Giving USA 2017: The Annual Report on Philanthropy for the Year 2016, released in June. 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. The nine categories are religion; education; human services; giving to foundations; health; public-society benefit; arts, culture and humanities; international affairs; and environment and animals.
“This report tells us that Americans remained generous in 2016, despite it being a year punctuated by economic and political uncertainty,” said Aggie Sweeney, CFRE, chair of Giving USA Foundation and senior counsel at Campbell & Company. “We saw growth in every major sector, indicating the resilience of philanthropy and diverse motivations of donors.” The rise in total giving was spurred largely by giving from individuals, which increased nearly 4 percent in 2016.
“Individual giving continued its remarkable role in American philanthropy in a year that included a turbulent election season that reflected a globally resurgent populism,” said Amir Pasic, Ph.D., Dean of the Lilly Family School of Philanthropy. “In this context, the absence of a dramatic change in giving is perhaps remarkable, but it also demonstrates the need for us to better understand the multitude of individual and collective decisions that comprise our record of national giving.”
Against that backdrop, the Giving USA Foundation also released a special, in-depth analysis of charitable religious giving in America. Giving to religion is defined narrowly as giving to local churches, denominations, mission societies, and TV and radio ministries. The findings are striking and unambiguous: the likelihood of a person making a charitable contribution to either a religious or secular organization increases significantly with religious affiliation. Religiously affiliated households are financially more generous than the general public. Therefore, church leaders must be willing to engage in conversations about giving. It must be connected to the personal sense of life mission and be in response to a call to altruistic vision and core values.
Another key takeaway from the analysis for pastors and church leaders is that money and giving conversations cannot be ignored. Individuals and families are eager to engage in generous giving and making a difference. At the same time, they cannot be separated from larger issues of spiritual development and religious life. These conversations must be holistic because they are connected. If a leader is not thinking about the future of faith communities as well as families and local communities, then they are also missing a significant aspect of the work necessary to foster generosity.
Our staff are prepared to work with church leaders and provide training in stewardship through seminars, committee meetings and church consultations. Our role is to build a culture of generosity focused on God’s priorities. Helping Christ followers discern how to create a legacy and equipping them with sound counsel are the practical strategies to fulfill our mission: Stewarding potential to build His Kingdom!
