Stronger Charitable Giving Forecasted for 2021 and 2022
March 21, 2021 — Massachusetts nonprofits can look forward to strong levels of charitable giving this year, before tapering slightly next year, if recently projected national trends carry over to the Bay State.
According to projections developed by the Lilly Family School of Philanthropy at the University of Indiana, which partnered with the University of Pennsylvania Wharton School of Business:
Driving much of this anticipated growth is expected strong stock market and GDP performance. Individual, household, and estate giving, along with corporate foundation giving, are especially influenced by growth in the S&P 500. Giving by other foundations is impacted by current and preceding years’ GDP and S&P 500.
The availability of vaccines for COVID-19 and the timeline for when they will be received may have an impact on the economic outlook, according to the analysis, which noted that variants of the coronavirus and policy changes in many countries introduce uncertainty that could affect economic growth.
In the U.S., tax changes proposed by the Biden administration could dampen charitable giving, the analysis noted. Those potential changes included increasing tax revenue by increasing the tax rate for the highest income bracket, increasing social security taxes, changing capital gains taxes, capping itemized deductions for high-income households, and expanding the estate and gift tax.