Mid-state charities fret as donors assess the GOP tax overhaul

Feb 5, 2018

NASHVILLE, Tenn. (OSBORNE)  --  Mid-state non-profits worry the Republican tax overhaul will hurt charitable donations, but a recent giving trend provides reason for hope.

Ellen Lehman is President of The Community Fund of Middle Tennessee. Lehman says that late last year the charity saw a surge in the creation of so-called Donor Advised Funds.

Credit cfmt.org

She says the unique giving tool provides donors with options at a time when it’s uncertain exactly how the new tax laws will impact an individual’s bottom line.

“When the initial gift is given to establish the fund the donor gets an immediate tax deduction even though these funds and subsequent contributions from the donor or others can remain in the fund for future use and making grants.”

The fund essentially turns individual donors into a charitable foundations. Holders can dole out money placed in the funds to the non-profits of their choice in various amounts and over several years.

Charles Schwaub says it saw a 91 percent increase in the number of such accounts it opened late in 2017, giving some indication just how much money was placed in this type of account.

Knowing that donors have those funds socked away will prove comforting to Middle Tennessee non-profits. They anticipate that changes to the tax structure will result in a drop in charitable donations going forward.

Lehman says it may be several years before charities know just how much of a reduction they’ll see. In the meantime, she says

“Appreciate the gifts that are made and the way they are made and to really focus in on how to fill the needs of a community but also fill the needs of a donor.”