The Poor, the Elderly, the Disabled Stand to Lose the Most

In reality, giving has got to come from the heart, not because you are saving some money in taxes. In actuality, though, movements by the government to guide how we live and spend our money are a major influence on how non-profits get funding.
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More Americans used food stamps to buy their Thanksgiving dinner than any time in our history according to US News & World Report. Forty two million of us are on food stamps, and the food stamp program (now called SNAP -- Supplemental Nutrition Assistance Program), cost the U.S. government $72 billion last year. This means one in 7 US residents receive SNAP benefits.

According to the Congressional Budget Office, three out of four SNAP households include a child, a person age 60 or older, or a disabled person. Households with very low income of about $8,800 a year are the receivers of SNAP. The average monthly SNAP benefit per household was $287, or $4.30 per person per day. This was a 70 percent increase in SNAP benefits from the 26 million people who received benefits in 2007. If we need one measurement of how crushing this recession has been, this is it.

So here we are in the last month of 2012 with our government facing another crisis (commonly now referred to as the fiscal cliff) and wouldn't you know that charitable giving is once again in the forefront of cuts. According to CNN, the charitable deduction is the ninth largest tax expenditure in the federal budget. In 2014, the amount of revenue the government would forgo from those claiming charitable deductions is estimated to reach $52 billion. Currently the wealthiest Americans can write off as charitable deductions 35 percent of their total contributions and President Obama wants to move that down to 28 percent in the latest rounds of negotiations on Capitol Hill.

The Chronicle of Philanthropy reports that there are significant differences in how much we give. In Utah and Mississippi households average 7 percent of their income to charity, while in Massachusetts and three other New England states, giving is under 3 percent. Middle class Americans give a far bigger share of their discretionary income, with households earning $50,000-$75,000 giving an average of 7.6 percent of their income to charity compared to 4.2 percent of people making over $100,000. Religion has a big influence on giving patterns. Two of the top nine states giving the most as a percent of income are Utah and Idaho, who have a high number of Mormon residents that have a tradition of tithing 10 percent of their income to the church. All of the other seven top states are in the Bible belt.

Although not all non-profit income is tied to tax incentives, the fear among non-profits is that much of it is tied to what Washington will be deciding in the next few weeks. According to The Arizona Republic and using Arizona as an example state, 28 percent of Arizonans claimed federal tax deductions for non-profit organizations that totaled $2.73 billion. The charitable deduction is especially popular as you climb the income scale -- whereas 12 percent of taxpayers earning less than $50,000 claimed this deduction, 81 percent of those making more than $100,000 claimed the charitable deduction.

Who is going to help those in need if our government decreases the incentive many Americans have to give? In states where the population has a tendency to give anyway, those in need may be propped up, but in states where tax incentives drive giving, those in needs may be in real trouble. America has always relied on The Salvation Army or The Gospel Rescue Missions to take care of those less fortunate. At DollarDays on our Facebook page, we are giving away 1,000 Marc Gold socks to non-profit organizations in need this December, so please nominate one you think deserves the help.

In reality, giving has got to come from the heart, not because you are saving some money in taxes. In actuality, though, movements by the government to guide how we live and spend our money are a major influence on how non-profits get funding. All of us, who trust in the good of non-profits, must let our leaders know that we believe it when the non-profit organizations tell us that they fear this fiscal cliff will shut down donations and this result touches us all. Here is a link to a website that will help you contact your members of Congress to tell them of your concern. This recession has taken its toll deeper than anyone expected. When over 42 million Americans have to rely on our government for food stamps and most non-profits must also rely on our government to help influence donations coming their way, we cannot absorb any more hits to our charity safety net. The lame duck session is now going on in Washington. We cannot afford lame duck results.

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