Money & Policy

4 Giving Tuesday Tips for a Year of Donor Fatigue

Natural disasters and tax reform suggest new strategies for charitable contributions

It’s #GivingTuesday2017, when charities invite us to open our wallets and donate. You may be thinking: Haven’t I already given enough in this terrible year of Hurricanes Harvey, Irma and Maria, the California fires and the earthquake in Mexico?

Only you can decide, of course, but bear this in mind: This is the time — months, and then years, after the disasters struck — that the victims desperately need support to rebuild their lives and communities by building schools, housing, medical facilities and roads. Yet history shows, once a disaster passes, people tend not to give to the afflicted there.

The Long Road to Recovery

“Natural disasters have very short life spans in the national spotlight, but that doesn’t mean the disasters are going away,” says Dan Saper, CEO of YouCaring, an online crowdfunding website for charitable causes. “They will continue suffering in places like Northern California and Houston. It’s going to be a long road to recovery.”

On top of this, given all the gigantic disasters this year — likely to tie the record for most billion-dollar calamities — “the disaster-response community is stretched very thin,” says David Campbell, co-founder of the disaster-relief nonprofit All Hands and Hearts. “We now have eight bases going; that’s double the amount we’re normally able to handle.”

One more thing to keep in mind on Giving Tuesday 2017: This may be the last year you’ll be able to get a tax deduction for your charitable contributions. The tax-reform bills won’t eliminate that write-off, but they’d double the size of the standard deduction, so far fewer people would benefit from itemizing their deductions and have a reason to claim the tax break. If the standard deduction proposal becomes law, charitable giving could drop by up to $13 billion annually, according to the Indiana University Lilly Family School of Philanthropy.

4 Giving Tuesday Tips

So with huge natural disasters behind us, and prospects for tax reform ahead, here are four Giving Tuesday tips to help you donate to charity today and through the rest of 2017:

1. Consider donating through your smartphone or through social media. Nonprofits are increasingly making giving easier these ways, especially on Giving Tuesday; Next Avenue is one of them, and here’s a link to its #GivingTuesday campaign. Last year, 17 percent of Giving Tuesday contributions were made through mobile devices, according to Blackbaud,a leading cloud software company powering social good..

For Giving Tuesday 2017, Bill and Melinda Gates are using their foundation to match up to $2 million of donations that are made to nonprofits on Facebook. More specifically, the foundation will match up to $50,000 per nonprofit or $1,000 per fundraiser or donate button until the $2 million in matching funds run out. And Facebook is waiving all the fees it normally charges for donations made to nonprofits through its social network.

2. When donating to help disaster victims, look for nonprofits specializing in this type of work. One way to do that is geographically, by contributing to a local community foundation in a place like Houston, the U.S. Virgin Islands or Northern California. Community foundations pool donations for the social improvement of an area, often after disasters. You can search among the 700+ community foundations listed in the Council on Foundations’ directory.

“A community foundation often acts as a hub for disaster relief,” says Rachel Hutchisson, vice president of corporate citizenship and philanthropy at Blackbaud.

Nick Tedesco, senior philanthropic adviser at the Philanthropy Centre at J.P. Morgan, says you might even want to speak with someone at a community foundation in the location where you want to assist.

“Reach out to the local community foundation to better understand what is needed, who’s best positioned to address the current needs and how the needs will evolve over time,” says Tedesco.

Another way to target your disaster-relief donations is by contributing to well-run charities that are all about that need. A good rule of thumb for charity efficiency: Look for one spending less than 20 percent of revenue on overhead costs.

These six, which get high marks from charity raters Better Business Bureau’s Give.org, Charity Navigator and Charity Watch, are involved in relief efforts for victims of Hurricanes Harvey, Irma and Maria; the California fires and the Mexican earthquake:

Another disaster-relief nonprofit worth considering is the newly merged one that brought together two complementary groups: All Hands and Hearts — Smart Response. Its volunteers are known for long-term commitments after a natural disaster. “Come early and stay late” is the motto, says Campbell.

He founded All Hands Volunteers in 2005 to provide relief in areas affected by natural disasters in the U.S. (Next Avenue wrote about him when he won the Purpose Prize from Encore.org in 2014.) After she survived the 2004 Indian Ocean tsunami, supermodel and philanthropist Petra Nemcova founded Happy Hearts Fund to rebuild safe, resilient schools in disaster-stricken areas (it has since rebuilt 171 schools in 10 countries).

The two groups first joined their hands and hearts after the 2015 Nepal earthquake. They recently tied the knot officially and deployed immediate response teams this year in the Florida Keys, St. Thomas and Texas, after Hurricanes Harvey, Irma and Maria.

“One message we’re consistent about is to recognize the lifecycle of disasters,” says Campbell. “There’s a lot of interest [by the public] in the initial 30 to 60 days, but these are multiyear events, really.” Campbell and Nemcova say it typically takes more than five years for a community to rebuild after a natural disaster.

3. Consider donating to a crowdfunding charity campaign. At sites like YouCaring.com and GoFundMe.com, everyday people and celebrities set up Kickstarter-like initiatives raising money to help individuals or localities with desperate needs. Sometimes, the donations are used to pay someone’s medical bills, but lately, the crowdfunding sites have been overrun with natural-disaster campaigns.

In fact, the four largest fundraisers in YouCaring’s history were for disaster relief and all were in 2017: football star J.J. Watt’s Houston Flood Relief Fund ($37 million raised; now closed); singer Ricky Martin’s People of Puerto Rico Hurricane Relief fund ($4.2 million; still open), basketball star Tim Duncan’s 21 US Virgin Island Relief Fund ($2.8 million; still open) and tech CEO Ric Elias’ Rebuild Puerto Rico fund ($2.3 million; still open).

Often, individual donations to crowdfunding campaigns are small but — taken together — powerful. The average donation to J.J. Watt’s fundraiser for Houston, says Saper, was $100.

One piece of cautionary advice about donating to a crowdfunding campaign: You’ll want to do some due diligence to check into its legitimacy.

An excellent, if tough, Charity Watch article, “Crowdfunding Popularity Continues to Soar Despite Risks to Donors,” noted that “crowdfunding campaigns that are established for the benefit of particular individuals or families generally are not required under state charity laws to register to raise funds.”

Also, the story said, “there is a profound lack of accountability and transparency, especially once the funds raised get disbursed to the campaign owner.” Public charities must disclose their finances through the Internal Revenue Service’s Form 990 filing, but there’s no similar mandated public disclosure for crowdfunding.

Both YouCaring and GoFundMe, however, do vet people who hope to raise money through their sites.

Crowdfunding donations generally are not eligible for tax deductions. The exception, says Charity Watch: if the funds are raised through a campaign organized by a registered 501(c)(3) public charity.

4. If you own stock that has risen in value and would be willing to sell it, you might donate your shares to a charity. You’ll get a tax deduction for the full fair market value of the stock and avoid owing taxes on your capital gain. The charity will be able to put to use the entire current value of the securities.

Kiplinger’s suggests that the best way to make this kind of donation to a small charity that isn’t set up to accept contributions of securities is through what’s known as a donor-advised fund. This fund — offered through financial services firms such as Schwab and Fidelity — lets you contribute the stock, take a deduction on your 2017 tax return and decide in the future exactly where the money will go.

A donor-advised fund might be especially useful for you in 2017 if Congress does pass its tax-reform bill and, consequently, you won’t itemize deductions in 2018 or beyond.

RIchard Eisenberg, editor at Next Avenue wearing a suit jacket in front of a teal background.
By Richard Eisenberg
Richard Eisenberg is the Senior Web Editor of the Money & Security and Work & Purpose channels of Next Avenue and Managing Editor for the site. He is the author of How to Avoid a Mid-Life Financial Crisis and has been a personal finance editor at Money, Yahoo, Good Housekeeping, and CBS MoneyWatch. Follow him on Twitter.

Next Avenue Editors Also Recommend:

Next Avenue brings you stories that are inspiring and change lives. We know that because we hear it from our readers every single day. One reader says,

"Every time I read a post, I feel like I'm able to take a single, clear lesson away from it, which is why I think it's so great."

Your generous donation will help us continue to bring you the information you care about. Every dollar donated allows us to remain a free and accessible public service. What story will you help make possible?