(Thanks go to Bob Carter)
are everywhere. Aristotle put it this way: 'It is not once nor twice but times without number that the same ideas make their appearance in the world.' These are random thoughts, ideas & resources on being successful."
"The best time to plant a tree was 20 years ago. The second best time is now."
(Thanks go to Bob Carter)
Charitable IRA Rollover Made Permanent!
Congress has passed a tax extenders package that would make permanent the Charitable IRA Rollover provision, and President Obama has signed it into law.
The tax extenders package, known as the Protecting Americans from Tax Hikes (PATH) Act of 2015, makes permanent a number of provisions that have previously gone through a constant cycle where they expired at the end of a given year, only to have Congress extend them for a limited time. This cycle has made it difficult for donors to plan their giving effectively.
The key charitable provisions that are made permanent in the tax package allow:
---taxpayers over 70 1/2 to make donations directly from an IRA and will not be taxed on the amounts—up to $100,000 (The Charitable IRA Rollover)
---enhanced deductions for charitable contributions of real property for conservation purposes, and for donations of food inventory
---shareholders in an S corporation to reduce their basis in the S corporation's stock under Section 1366 only for their share of the basis of property contributed by the S corporation—not the fair market value.
It’s that time of year time of year when my clients (and every non-profit organization!) are all producing their year-end fundraising materials and campaigns. Those are precious days between Thanksgiving and New Year's, when most charitable giving takes place!
But what about that first Tuesday in December now called dubbed #GivingTuesday?
I'm not a big promoter of GivingTuesday for small shops…yet. It's great for national charities. But it is still finding a place for kind of small non-profit organizations I serve. For these organizations, it can divert time and energy, just when they should be focusing on their overall year-end giving strategy--a well planned, 8-week multiple contact campaign of direct mail, email, e-blast and social media.
The vast majority of giving still takes place between November 1 and December 31. You should have a plan for every one of those days. So, I see GivingTuesday just as one of several tactics in that time period. I don't see the necessity to connect with one of the big on-line services, even for the small matching gift you may receive. Do three e-blasts to your email list the week before and three on December 2. Send them to YOUR website and giving portal, not someone else's. And leave it at that.
GivingTuesday may find a larger place for small shops... in time. But it's not there yet.
What do you have planned for your total year-end strategy? Use #GivingTuesday to your advantage, but only as a part of your big-picture strategy.
I was found this commentary from Tyler Cowen very intriguing and thought I would pass it along:
Effective Altruism: Where Charity and Rationality Meet
From The New York Times - August 14, 2015
By Tyler Cowen
You are lucky enough to have some money to give away: It could be $100 or $1 million. Whether you are prepared to make a small donation or a big one, you would like to accomplish something good with it.
But how do you evaluate the best way to deploy your money? Alas, economic research until now has offered little guidance. Nonetheless, a new intellectual and social movement — a loosely affiliated group of people who call their effort effective altruism — is encouraging donors to think more scientifically about philanthropy.
From the standpoint of effective altruism, the problem behind a lot of charitable giving is that individuals often make donations without doing much analysis. They simply think the best of charities that interest them and accept at face value that these charities are doing a terrific job. Accountability is never considered.
To address this problem, GiveWell, a nonprofit organization dedicated to effective altruism, has been evaluating whether charities are solving important problems in a cost-effective manner. In addition, William MacAskill, one of the founders of the movement, has just published a book-length manifesto, “Doing Good Better: How Effective Altruism Can Help You Make a Difference” (Gotham Books, 2015).
Although he is a philosophy professor at Oxford University, Professor MacAskill’s arguments rely on economic concepts. They include opportunity cost — comparing a given gift with relevant alternatives — and the notion of unintended consequences, since not all gifts bring the sparkling benefits that the donor expects.
What concrete advice does Professor MacAskill offer?
First, when there is a disaster and it is well publicized, your money may not be urgently needed. In such cases, he says, there is typically more money being donated than the infrastructure on the ground can handle, as occurred after the Haiti earthquake in 2010. If we follow our immediate emotions, he says, the best intentions often do not produce the best outcomes. He also suggests that toiling in a high-paying job that isn’t itself socially useful and then making a big donation may be better for the world than quitting the lucrative job and volunteering for charitable work or joining the Peace Corps.
Second, don’t assume that charities with high measured overhead costs are necessarily bad; you would not usually discriminate against a commercial product on this basis, for instance. Sometimes effective aid requires a lot of back-office expenditures, just as a good medicine needs a trained sales force or Walmart relies on a large distribution network. Sometimes, he says, the most effective charities may spend a lot of money evaluating their own programs or even raising money for further investment.
Third, right now is an especially good time to give away money. Because some parts of the world remain so destitute, it may be possible to save a life for only a few thousand dollars of well-directed charity. That may not be the case in a future when the world is much wealthier and many fewer people live on the margins of subsistence. Professor MacAskill cites public health programs such as using drugs to rid people of dangerous worms, and eliminating malaria, as the Gates Foundation has tried to do.
Neither Professor MacAskill nor the effective-altruism movement has answered all the tough questions. Often the biggest gains come from innovation, yet how can a donor spur such advances? If you had a pile of money and the intent to make the world a better place in 1990, could you have usefully expected or encouraged the spread of cellphones to Africa? Probably not, yet this technology has improved the lives of many millions, and at a profit, so for the most part its introduction didn’t draw money from charities. Economists know frustratingly little about the drivers of innovation.
And as Prof. Angus Deaton of Princeton University has pointed out, many of the problems of poverty boil down to bad politics, and we don’t know how to use philanthropy to fix that. If corruption drains away donated funds, for example, charity could even be counterproductive by propping up bad governments.
Sometimes we simply can’t know in advance how important a donation will turn out to be. For example, the financier John A. Paulson’s recently announced $400 million gift to Harvard may be questioned on the grounds that Harvard already has more money than any university in the world, and surely is not in dire need of more. But do we really know that providing extra support for engineering and applied sciences at Harvard — the purpose of the donation — will not turn into globally worthwhile projects? Innovations from Harvard may end up helping developing economies substantially. And even if most of Mr. Paulson’s donation isn’t spent soon, the money is being invested in ways that could create jobs and bolster productivity.
In addition, donor motivation may place limits on the applicability of the effective-altruism precepts. Given that a lot of donors are driven by emotion, pushing them to be more reasonable might backfire. Excessively cerebral donors might respond with so much self-restraint that they end up giving less to charity. If they are no longer driven by emotion, they may earn and save less in the first place.
Still, those objections aside, it is hard to believe that Americans cannot improve their practice of philanthropy. In a world of high income inequality, we will have a much better future if donations from the very rich can bring some of the social benefits associated with the past generosity of Mellon, Carnegie, Rockefeller and others. And donations from less wealthy people can help a great deal if they are well directed.
Early in his book, Professor MacAskill considers the provocative hypothesis that the best man ever to have lived was a Ukrainian named Viktor Zhdanov. Working with the World Health Organization, Mr. Zhdanov called for a systematic campaign to eradicate smallpox. He presented a visionary plan, sold the organization on the idea and, by accelerating the end of smallpox, probably saved many millions of lives. If you haven’t heard of him, or haven’t thought of him lately, that’s evidence that the effective-altruism movement has something to offer. Even for small givers, a more rational approach to philanthropy can focus attention on areas that make the biggest enduring contribution to human welfare.
Tyler Cowen is a professor of economics at George Mason University.
Over the last few weeks, we have all been working on year-end direct-mail appeals. I found this video very compelling. It comes from Chris Davenport at 501Videos and interviews Tom Ahern. He looks at how nonprofits use emotional triggers to increase donor response.
This video comes from Movie Mondays. Each week, they put out a short video with insights from other fundraising professionals. Go to:
www. moviemondays.com to sign up.
I am blessed to live in an area where the recession had much less impact than it did in other regions. Certainly the recession hit us here, especially psychologically. However, I keep hearing people lament their lack of fundraising success and blaming it on the economy. While the economy seems to be a little better everyday, media reports want to keep us on a continuous roller coasters. But, if "best practices" guide us, fundraisers will continue to be successful... no excuses.
There are a number of reports that come out each year that are benchmarks for the non-profit sector and fundraising. One is “Giving USA” from The Giving Initiative, which comes out later in the spring. Another is “The Charitable Giving Report” from the software firm Blackbaud. They are the largest software supplier in the industry.
he latter report was recently released and reinforces my thoughts. The report includes data from 2013, from 129 nonprofit organizations, representing $12.5 billion in total fundraising. The Report also includes online giving data from 3,359 nonprofits, representing $1.7 billion in online fundraising.
The bottom line of this latest report is that things are getting better for the economy and thus for our organizations. We have regained the steam we lost since the recession and we are now seeing growth for most organizations in most sectors. Here are some of Blackbaud’s talking points from the report:
I was a Blackbaud client for over 20 years, but I’m not particularly endorsing their products. But they have many useful tools on their website in addition to the report, including “The Blackbaud Index,” which tracks giving by the month. They may want your email address to get to some of the information, but I think it is worth it. Take a look at the full report by clicking here.