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Manhattan Institute

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On Giving Tuesday, Consider the Ways Our Tax Code Discourages Charity

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On Giving Tuesday, Consider the Ways Our Tax Code Discourages Charity

National Review Online December 3, 2019
Civil SocietyOther

The impulse behind the annual occasion is admirable. But there’s much more we can do to increase and better measure Americans’ charitable giving.

The annual Giving Tuesday campaign to increase charitable giving in the spirit of the holiday season is back again. It’s never been entirely clear, however, whether the occasion increases overall charitable giving or merely shifts more of it to the first Tuesday in December — and, indeed, there’s reason to think that that’s exactly what’s happening.

The most authoritative source tracking U.S. charitable giving — the Giving USA tabulation compiled by Indiana University’s Lilly Family School of Philanthropy — has reported that, even as overall giving climbed in 2018 (the most recent year tracked), individual giving declined. Specifically, “giving by individuals totaled an estimated $292.09 billion, declining 1.1% in 2018 (a decrease of 3.4%, adjusted for inflation).” This is exactly what one what would expect following the passage of the 2017 Tax Cuts and Jobs Act, which by raising the standard deduction for federal income-tax returns drastically reduced the number of taxpayers who itemize their deduction, and who thus no longer qualified for the charitable tax deduction.

In other words, Giving Tuesday is trying to push back against a tide that transcends appeals to individual generosity. To actually increase charitable giving, we must adjust the tax code.

Continue reading the entire piece here at National Review Online

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Howard Husock is a senior fellow at the Manhattan Institute and author of the new book, Who Killed Civil Society? 

Photo by SPmemory/iStock

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