How the 2017 Tax Reform Bill Could Effect Local Non-Profits

Do you ever stop to ask your self how your community’s local non-profits stay afloat? It may not be a topic of concern on a regular basis. However, with 2017’s Tax Reform Bill, your local non-profit may not receive as many small donations in comparison to previous years.

The 2018 Tax Reform Bill increased standard deductions meaning that those who donate less than $12,000 will not see the previous write-off benefits that they once had. An individual filing as a single adult will now need to spend almost double the previous deduction amount from 2017.

With the largest piece of tax reform legislation being passed in more than 30 years, there is a lot of information to absorb. The Portage Foundation teamed up with University Hospitals out of Ravenna, OH to hold a community event, aimed at initiating a conversation on how this bill will affect philanthropy in the Portage County community.

The director of the Portage Foundation, Linda Fergason, helped with the event on behalf of the organization.

“It all depends on a person’s current status in terms of income and what they do in terms of philanthropy, but what we did was we talked about some of the changes as they affect nonprofit organizations, that’s a long story,” Fergason said. “Also, it affects individuals and there are new ways that individuals can become involved with donor advised funds and make it more advantageous for them from a tax standpoint.”

In addition to the standard deduction changes the personal exemption is also making an adjustment. Previously, the personal exemption was $4,050 per person. Now, that portion has been completely removed.

Aside from the changes being faced, some involved with non-profits are not discouraged. Ele Ells, the program director at WKSU radio, is no stranger to small donations. With the commencement of spring, also begins WKSU’s on air fundraising, which is how they receive a large portion of their small and moderate donations.

“WKSU relies very heavily on individual donations. Between individuals and corporate support, we get 80% of our funding that way.  We’re currently doing on-air fundraising, which means we go over the air, we ask people to call in and give us money and they do, I can’t think of another industry that works that way. we do our product we give it to everybody for free and then we ask anybody that likes it enough to give to us, which is pretty awesome, they do,” Ellis said. “I personally would like to believe that while a lot of the people that do give to us take the tax write-off, it’s probably not the tax write-off, that’s probably not the reason why they’re doing it. They’re giving us money because they listen to wksu they believe in what we do and they want to support independent journalism and I don’t think there’s anything wrong with that.”

Many organizations are unsure of how this tax reform will affect their donation intake overall, and expect to start to see changes in the coming months.

Another Portage County organization that heavily relies on donations is the Happy Trails Farm in Ravenna. The rescue farm relies on a variety of donation sizes when it comes to keeping animals safe and secure.

Hope Evans joined the Happy Trails team around seven years ago, where she spearheads the marketing and fundraising for the organization. Happy Trails hosts fundraisers through out the year in addition to applying for grants and generous contributions.

Evans walks towards a fenced in area on the farm to call over spider pig, whom us very curious, according to her to see if she has any treats today. Evans said that he was rescued from running around a busy area in Akron.

We run solely on donations, so every little bit helps us.  We have a lot of dedicated supporters that have supported us for years and we do a lot of fundraisers.  Our biggest one is in October November, and then we do little fundraisers during the year when it’s warm out,” Evans said. “We use grants for special projects that we do, we also get a lot of feed donations as well so that really helps us out with cost because we have to pay for everything here. Vet bills and everything, so the donations that we get, we need them really bad.”

Over the course of 2018 non-profit organizations across the United States may see a reduction in small and moderate donations. While it is unclear to what extent, it is clear that some kind of change is on the horizon.