At this time of year, many of us start to think about our annual charitable giving, but this is no traditional year. It feels like the world as we know it is shifting, perhaps as it did for Noah at the time before the flood. The flood of crises we’ve experienced this year has challenged our usual ability to respond.
In the already difficult context of the Covid-19 pandemic, we’ve faced demands for greater racial justice, wildfires, declining air quality and with that, a deeper concern about climate change. In addition, there is a rise of antisemitism and, in our national context, ongoing threats to our democracy.
We are confronting a once-in-a-lifetime set of crises.
In the Bay Area, more than 10 percent of our population (at least 400,000 people) work in hospitality and leisure. Many of these workers, already at the bottom of the pay scale, have not been able to work full time since March, increasing their risk of food insecurity and homelessness.
In addition, more than 1.1 million people who live in the Bay Area are over 65 and thus more vulnerable to Covid-19. As a result, nonprofits are seeing greater needs, higher costs, challenges to using volunteers effectively and — in many cases — a decline in funding.
Amidst the deluge of needs this year, you likely have already given generously. So how should you consider what you might give, as we approach the end of this calendar year?
How should we respond?
No matter what the size, your gift matters. Our Federation Philanthropy Partners team counsels hundreds of families about their giving, through the lens of Jewish values. We support families by helping them articulate and clarify their principles and interests. Which issues in the news move them to action? Which causes and organizations do they care deeply about? The answers to these questions are often a starting point.
Where should we give?
There are no right or wrong answers here. There are so many needs right now, and so many important causes and organizations. Your choices should be based on the areas you care about most:
Jewish agencies, human-services organizations, racial and social justice organizations, environmental and climate justice organizations, organizations working to strengthen our democracy and/or arts organizations.
Thinking strategically about giving
As we talk with families about their giving, here are some tips that we frequently share.
Give early. Organizations need cash, so give now instead of at the end of the calendar year. Your gift enables them to predict their annual revenue and then plan accordingly.
Give unrestricted gifts. This offers organizations flexibility, especially in a time of uncertainty.
Give more this year to organizations you care deeply about. Consider making a multiyear commitment to help give an organization stability.
Consider volunteering, including asking others to contribute to the groups you care about.
Be in contact with the organizations you support in a significant way to understand their needs.
Expand your giving by making a significant gift to an organization you’ve never supported that works on a cause you care about.
Use a donor-advised fund to help simplify your giving. A Federation-based donor-advised fund also indicates to grantee organizations that support is coming from the Jewish community. We are happy to tell you more about how this approach might benefit your giving.
Special opportunities to give more in 2020
In 2020, there are some unique opportunities to give that may stretch your philanthropic dollars further. Scan this list to see if one or more of these approaches may make sense for you. Be sure to consult your tax advisor to make the best use of these options.
Non-itemizers who take the standard deduction are allowed to deduct charitable donations of up to $300.
There is no “required minimum distribution” for IRAs in 2020. Instead, consider making qualified charitable distributions (QCDs) directly to your favorite charitable organizations of up to $100,000 to reduce your taxable IRA balance. Remember to start the process early.
For itemizers, deductions for cash gifts increased to up to 100 percent of 2020 adjusted gross income (up from 60 percent).
Gifts of appreciated assets remain a smart way to give: Receive an income-tax deduction of up to 30 percent of AGI and pay no capital-gains tax.
A low-interest-rate environment has made charitable lead annuity trusts a great way to support the nonprofits you care about now and establish a plan to gift assets to family members in the future.
Just as in the story of Noah, in time, the flood waters will recede. Thanks to your generosity, our community and the organizations we care about will remain strong. This is the rainbow that will appear to us after this storm has passed.