A tax deduction is not the only reason to give
I have a great fascination for the great philanthropists in our history and the great spirit of philanthropy that permeates our culture. Did you know that Americans give more money voluntarily than the citizens of any other country? We give seven times more money to charity than the citizens of Germany for instance. Another example is the absolute tsunami of cash given to the Asian Tsunami relief effort in 2004. Americans privately gave over $2 billion and our government chipped in another $900 million. The generosity of our country is absolutely astounding. If you would like to learn more about this subject I highly recommend Albert Brooks’ book about charitable giving entitled Who Really Cares?
Why do Americans give so much?
The first reason is fairly obvious: we have been financially blessed beyond any other culture or country in history. Therefore it is incumbent upon us to share those blessings with those who need it as much as we can. Another reason is that our government reduces our tax burden in the form of IRS tax deductions when we give to non-profit organizations. The gift deduction incentives generosity.
Don’t be motivated by just the tax deduction.
It is important to remember that a tax deduction is not a right, we are not necessarily entitled to a charitable tax deduction in our country’s founding documents, but it is a wise benefit that our leaders have given to us. The result is the huge number of charitable organizations and non-profits that have sprung up in our country. Tax deduction or not, we all need to take some time to consider what we can do to use our financial blessings to help our fellow man.
Your gifts are needed now more than ever.
Thomas Paine once famously wrote, “These are times that try men’s souls.” If you happen to be an administrator at a charitable organization these days, you are certainly under pressure. The need for service to humanity is greater than ever, but the funding is drying up.
Most charities depend on major donor gifts and many of those gifts are usually tied to some kind of investment. Some charities have the luxury of a foundation behind them, but the assets of those foundations are almost always invested in the stock market in one form or another – the same market that has lost almost 40% over the last year.
Major gifts to charities are down because of the economy and the dependence of major gifts on the market. While you and I might not be able to give a major gift of stock or annuities or bequeath an inheritance, we can all find a way to give a small gifts. Imagine the blessing for charities who were formerly dependent on large gifts were to suddenly find an upsurge of small gifts from people without great wealth.
Don’t have a favorite non-profit?
They are not hard to find. There is probably a charity within walking distance of your house that needs some help. Ask your friends and family about charities that they like. When I am considering a gift to a non-profit, I always check out my chosen charity at Charity Navigator. The list of charities on this site is almost exhaustive. You can find almost every charitable organization in the United States and they are all rated on several different levels. You can see what percentage of your money actually helps the recipients. You can find out CEO compensation and even leave a comment of your own about a particular charity.
Let me suggest some charities to you that I have impressed me. Part of the reason that I hope to gather my money “little by little” over my lifetime is so that I am someday in a position to help one or more organizations like St. Jude’s Children’s Hospital which exists “to find cures for children with cancer and other catastrophic diseases through research and treatment”. Another organization that I support is Samaritan’s Purse, one of the foremost disaster relief organizations in the world.
So how about you? What organizations do you like? Is there a local charity that you admire? Maybe you work in a non-profit and you could share some information about giving levels over the past few months.
Photo by: HowardLake