Non-profits brace for possible downside of new tax law

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RENO, Nev. (KOLO) - They serve numerable causes and needs, an essential part of the safety net the most vulnerable among us rely on, and they--the non-governmental charitable organizations and non-profits--rely in turn on donations from all of us.

But the tax bill that cleared Congress and the President has now signed has changed the landscape. Tax time will be simpler for a lot of us. The standard deduction doubled means fewer will be itemizing, claiming deductions for charitable donations. Predictions are for a cutback.

"We're looking at a $12 to $20 billion decrease in charitable givings to organizations in 2018 alone," says Reno CPA Mark Robertson, "and also the impact of the estate tax, you're looking at another $4 billion when that's fully implemented.":

That possibility is unwelcome news to the non-profits.

"There's nothing that we're more proud as a society than a giving society that we are," says Al Brislain, President and CEO of the Food Bank of Northern Nevada. "Why would you take away the incentive for people to give charitable donations. It just doesn't make sense to us."

Some are more optimistic.

"I think it's a reasonable prediction that there will be some impact to charitable giving," says Marie Baxter at Catholic Charities, "but we know most people realistically support charities because they have a personal interest or passion in what that cause is."

The impact, she says, may be less for a faith-based charity or a well established non-profit with a lengthy donor list.

"If you're a start-up non-profit or a smaller non-profit with a smaller donor base more reliant on people that were more like 'Wow, it's the end of the year I'm going to pick five charities and give money,' that's going to be more of a struggle."

But that's not to say the years ahead may be more challenging for these organizations. The federal government is also cutting programs that some of these organizations serve. That will shift more of the load to them just as finding the donations to meet those needs is getting all the more challenging.

"To pay for these cuts there's some talk about cutting some programs that really do help children and seniors, people with disabilities and again it doesn't make sense to put more holes in the safety net at a time when some people are really having a hard time," argues Brislain.

All agree non-profits will have to depend even more on pitches that appeal to the heart rather than the calculator.

"Charitable donations still need those dollars," says Robertson. "So while taxes certainly are an item to consider but it should not be the only thing you consider when giving money."