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David Baker

If an individual can deduct $300 under the CARES Act, can a couple filing jointly deduct $600?

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According to the Joint Committee on Taxation’s Report – JCX 12R-20 (April 23, 2020)
The provision permits an eligible individual to claim an above-the-line deduction in an amount not to exceed $ 300 for qualified charitable contributions made during a taxable year that begins in 2020. n75 The above-the-line deduction is not available for contributions made during a taxable year that begins after 2020. An eligible individual is an individual who does not elect to itemize deductions. n76 Thus, a taxpayer taking the standard deduction, who absent the provision would not be able to deduct any charitable contributions, may claim an above-the-line deduction for qualified charitable contributions.


n75 Sec. 62(a)(22).

n76 Sec. 62(f)(1). The $ 300 limit applies to the tax-filing unit. Thus, for example, married taxpayers who file a joint return and do not elect to itemize deductions are allowed to deduct up to a total of $ 300 in qualified charitable contributions on the joint return.


Raising Money for a Non-Essential Nonprofit

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Non-Essential is Relative! This necessary perspective provided by one of our own–Dave Stephens.

Radio’s not really essential during a pandemic. Everyone’s giving to first responders, food banks and other places that are vital during a crisis. How do you expect to fill in the growing funding gap?

My full-time job is raising support for the River Radio Ministries. I also have a part-time consulting business with Giving Design helping nonprofit organizations across the country with their fundraising technology—a good number of them radio stations. So, you can imagine how encouraging it was to have someone tell me these ‘obvious’ things. *Note my obvious sarcasm.* However, his statements gave me pause and caused me to consider—“Is what I do essential, and who decides?”

1. Radio (insert your nonprofit here) is not really essential during this crisis.

I disagree. Has someone told you your organization is currently non-essential? If your organization met needs prior to this crisis, did people stop having the need that your organization addresses now that we’re stuck at home?

You may not be able to do things “normally” right now, but that doesn’t have to mean you can’t address the need. I’m seeing more virtual concerts, festivals, conferences, counseling, prayer ministries, drive-in church services, and streaming services. People are stepping up to meet needs. You can too.

Right now, there’s someone fighting anxiety on their essential job, and a song on the radio will bring them hope. At this moment, there is someone at home, alone, who hasn’t had real human contact in a month, and their favorite DJ is making them laugh and letting them know that there is someone who understands.

Perhaps your org is less essential to some people today than it was a couple months ago, but I would bet that your organization is also far more essential to some than ever before. We must continue to love and serve. To do that we have to continue raising money.

2. Everyone is giving to food banks and other places that are vital during a crisis.

Great! I’m glad that people are supporting the places that are seeing increased demand right now. More and more people are out of work and struggling. BUT do those increasing needs lessen the significance of your organization’s work?

For many people just because they‘re giving to your local food bank doesn’t mean they can’t give to you. This is the moment for you and I to encourage people to lean into remarkable generosity. Many can, and many will. We can even invite new givers to join us in our work that is essential. Don’t quit asking because there are other needs. You have supporters who are passionate about you and they’re waiting for you to ask.

Let’s celebrate and encourage the gifts to foodbanks, first-responders, and those that are stepping in right now and saving lives. River Radio Ministries is stepping up and supporting them too. Their need doesn’t make what you do less important.

3. How do you expect to fill in the growing funding gap?

I don’t know—but I will tell you the ways that we are trying. We’ll:

  • Continue to serve our listeners and donors the best possible way we can.
  • Continue to remind people how their support is changing lives with impact stories like this:

“The River has been an integral part of my life for the last 5 plus years. This season of my life was a difficult one with the passing of close friends that were guiding lights in my life, and the loss of a long-term relationship. I was lost and broken, but The River was, and still is, my constant source of hope and promise. I proudly say, I am the River.”

  • Continue to invest in genuine relationships with our donors as people first.
  • Continue to invite people to get involved. Just “Click Here” to give hope right now.
  • Continue to love and thank our supporters for changing the world.

My encouragement to you.

If your organization was worthy of existence before COVID-19, then it’s worthy of support during it. Remember that you are essential to many. What you do matters, and if for some reason you can’t do it right now, this will end, and your donors and you will be back bettering lives in no time.


Donor and Employer Incentives in the CARES Act – Part 2

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This is an above-the-line federal deduction available to every taxpayer claiming the standard deduction starting with the 2020 tax year. A donor may make a CASH gift and deduct up to the first $300 of that gift from his or her income. She can claim the standard deduction AND claim up to $300 for this special charitable deduction. Taxpayers who itemize–projected to be just 13.7% of all taxpayers in 2019 by the Tax Foundation–are not eligible to also claim the $300 deduction.

Here’s some practical FAQs:

Who would most likely BENEFIT from this deduction?

  • Monthly donors, and
  • Possibly donors giving less than $10,000 each year.

Who would most likely NOT BENEFIT from this deduction?

  • Donors who give from their donor-advised fund or private foundation;
  • Donors who give appreciated property like stock or mutual funds; and
  • Donors giving $10,000 or more each year.


Only for the 2020 tax year, donors who itemize deductions on their federal personal taxes can now deduct charitable CASH gifts up to 100% of their adjusted gross income. Prior to the CARES Act, donors could only deduct cash gifts up to 60% of their adjusted gross income.

Who would likely BENEFIT from this deduction?

  • Wealthier/high income donors who want to make a major gift and reduce or eliminate their 2020 tax bill;
  • Donors who want to accelerate existing pledges to public charities.


Prior to the CARES Act, a corporation could generally deduct CASH gifts up to 10% of its taxable gross income. For 2020, corporations may deduct CASH gifts up to 25% of their taxable income.

Remember: Many small businesses are corporations. Entrepreneurial donors may be able to take advantage of both the personal cash gift incentive as well as their business take advantage of the corporate incentive.


Navigating & Prioritizing the CARES Act – Part 1

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Two loan opportunities made available under the new CARES Act (the Coronavirus Aid, Relief, and Economic Security Act) require quick action–possibly even yet today: the Paycheck Protection Program (PPP) Loan and the Economic Impact Disaster Loan (EIDL) Program. 

Paycheck Protection Program (PPP) Loan

The PPP Loan is available for eligible 501(c)(3) public charities, 501(c)(19) veterans organizations, and small businesses with 500 employees or less. This loan program is intended to sustain organizations and their employees negatively impacted financially by the current COVID-19 crisis. The proceeds of these loans can be used to cover payroll costs, two months of rent, mortgage payments, and/or utilities, and interest payments on existing debt. 

These loans are initiated with and administered by your bank and can be for a principal amount that is the lesser of $10m or 2.5 times the organization’s average monthly payroll costs for the previous 12 months. 

Some or all of the principal amount of the PPP loan can be forgiven depending on the amount of the loan used for payroll costs and the degree to which the organization can keep employees on the payroll for 8 weeks form the start of the loan. Only loan proceeds used during that first 8 week period are eligible to be forgiven. Remaining balances will have a 2-year term at a 0.5% interest rate.

PPP Loan applications should be available today, April 3rd. If you have any interest in applying or exploring if this loan is right for you or your organization, don’t wait. Get started on the application and talk to your banker today. 

Economic Impact Disaster Loan (EIDL) Program

Unlike the PPP Loan that originates with your banker, EIDLs originate with and are administered by the Small Business Administration (SBA). Additionally, EIDLs are available to a broader segment of nongovernmental nonprofits including 501(c)(3), (c)(4), (c)(5), and (c)(6)s and are, it appears, able to be used for a slightly broader list of operating expenses. The maximum possible loan is $2m for organizations that can demonstrate substantial economic injury as a result of the COVID-19 crisis. 

Eligible nonprofits and small businesses are given the opportunity to seek an immediate $10,000 advance that is distributed within 3 days of application. The $10,000 is forgiven even in the event the organization is ultimately denied its EIDL Loan. EIDL’s charge a higher interest rate of 2.75%. 

In the event your organization is facing or anticipating a crisis, you may want to consider starting the application today with the SBA. Some EIDL eligible organizations may qualify for a PPP Loan as well which is fine so long as EIDL proceeds are not used for PPP purposes.  


A Reflection After the First Week (COVID-19)

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All Storms Run Out of Rain

by Steve Lawton, Giving Design Consultant
My work with the Museum and Gallery, making friends for the new museum, came grinding to a halt last week. Not a complete stop, but I will not be able to meet any clients. Not on campus. Not at a restaurant, coffee shop, museum, church…not anywhere face-to-face. 
My wife’s work as piano teacher and church accompanist dried up like fine grass planted in July. No lessons. No recitals. No new music to learn for choir. No choir. Sad kids. Sadder moms. A big dip in income means a bit of anxiety. We expected it. 
We are in self-imposed 15-day quarantine because I am high risk, and my sweet wife is medium-high risk. On Monday I delivered three pots of steaming Tuscan cannellini and sausage soup to three shut-in families. It would be my last visit to them. I kept my distance and tried to explain.
Back home, we put our reasonable stash of groceries away, and after turning off yet another alarmist “Breaking News!” TV segment, I found myself suddenly saying to my wife:  “I really like being home. I really like having you here!”
A dark cloud may yet have a silver lining. We love having generous time at home together. We watched a whole movie in one go! We made creative home-cooked meals. We can take walks, “distancing” of course. We always enjoy a drive in the foothills. (Gas is suddenly $1.68). I love photographing spring, a real treat for the eyes in the South. We can both be on the same phone call, skyping with our family. We can to go to bed at 8 and get up with the chickens. Or watch a second movie that goes until midnight. It’s like having a sweet little chunk of our lives back, with the faint fragrance of honeymoon about it. 
The virus will end, we will go back to meaningful work that we enjoy, and sharing life with friends, cooking for shut ins… but I believe we will carry this gift of joyful perspective with us, going forward. When the storm runs out of rain, (and it will!) we will still be enjoying many of these flowers.


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IRA Rollovers Piggy BankIt only took Congress 9 years to get it right.

After being first offered for the 2006 and 2007 tax years, the I.R.A. Charitable Rollover has been made permanent. This is much better news than in December 2014 when Congress extended the giving incentive for a less than generous 14 days.

On December 18, 2015, the President signed the Consolidated Appropriations Act, 2016 (H.R. 2029) which included the Protecting Americans from Tax Hikes Act of 2015 (PATH Act). The PATH Act made I.R.A. Rollovers to Charity available for the remainder of 2015 but also extended this planning opportunity indefinitely.

Here’s what you need to know:

  • I.R.A. rollovers can only be done by I.R.A. owners who are 70 1/2 or older.
  • The rollover must be made to a qualified public charity. (No, donor-advised funds are NOT qualified under the provisions. Pretty much every other charity is qualified.)
  • The rollover is limited to $100,000 per year.
  • The I.R.A. owner donor can split the $100,000 among multiple charities.

Just as in the past, the benefit to the donor is that the amount directly transferred to charity is not recognized as taxable income to the donor. The rollover also counts against the donor’s required minimum distribution from their traditional I.R.A. The donor does not receive a charitable income tax deduction for the rollover.

Now what?

If you’re a donor and meet the qualifications above, consider using an IRA rollover gift each year to reduce your taxable income.

If you’re a development professional make sure to educate your more senior donors when you’re visiting with them about the benefit s and ease of IRA rollover gifts. This gives you an opportunity to serve them without an urgent ask. Also, make sure you include IRA rollovers when marketing gift opportunities throughout the year. If you don’t know where to start, we’re here to help!




Cyber Monday is Dead.

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Maybe not quite dead yet, but hear me out.

All of the stats I’ve reaCyber Monday is deadd over the weekend indicate that Christmas Cyber Shopping began in earnest on Thanksgiving day. MarketWatch reported that the earliest numbers from the Adobe Digital Index showed that “e-commerce sales totaled $1.73 billion on Thanksgiving Day, with 57% of traffic coming from mobile devices.”

If you’re old enough to know the history of Cyber Monday, you understand why it will soon “not be a thing.” Shortly after Al Gore invented the internet and AOL told us we had mail, retailers rushed to turn the web into a sales channel. Twenty years ago (can you believe Amazon is 21 years old?) only movie theaters, gas stations and Waffle Houses were open on Thanksgiving day. Black Friday was firmly entrenched as a cultural “must do” that carried over to Saturday and Sunday as retailers kept their doors open longer and longer.

Back at home, our dial-up internet and desktop computers were simply not suited for hours upon hours of online anything. After a weekend full of bricks and mortar shopping, white collar employees would go to work on Monday and finish off their Christmas list in the new world of online shopping compliments of their employers’ hi-speed internet and at the expense of the day’s productivity.

But that was then. Now most of us carry smart phones with better internet connectivity the average home had 10 years ago.

What does all of this have to do with charities and fundraising?

Your donors and prospective donors are the same people that spent nearly 2 billion dollars online after they downed their Thanksgiving feast. They aren’t the folks that fought live and in person for vegetable steamers at Walmart Friday morning.

If you’re in the fundraising business, you need to consider and invest in your online giving experience like it’s an additional Annual Fund Officer. The time is gone when it can be an afterthought or something you know needs reworking but you keep pushing it further down your to-do list.

In the same article, MarketWatch also reported that on Thanksgiving day, “emails from retailers drove 25% more shopping than last year and contributed to a huge mobile shopping day.” Your 2016 goals need to include: 1) create more legitimate and compelling ways to collect email addresses of donors and prospects, and 2) make sure your online giving experience is mobile friendly.

We know online giving continues to grow year over year. If yours isn’t, it’s time to figure out why. If you’d like a few guidelines and want to see a great example of a mobile friendly, effective online giving form, check out my previous article The Best Online Giving Form You’ve Never Seen.



The results are in, and they’re not pretty! (Your Board needs help)

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The infographic tells the dire tale.

Board Giving InfographicWe asked participants how many of their board members had introduced at least 1 prospective donor to their organization yet this year. The answer wasn’t surprising. Very few board members have been engaged in the development process. The good news is that there is still time. We have just under 3 months left to make a difference. (Hat’s off to the 32% who were pulling their weight!)

Further concerns:

  • The percentage of board members not making an annual gift of any amount to their organizations is unacceptable.
  • More than half of the organizations responding do not have job descriptions for their board members.
  • Nearly 3/4 of the organizations have not had a board retreat since 2013.

If your board doesn’t have a job description yet that clearly set expectations around their personal giving and relational fundraising, it’s time.

If your board hasn’t met for a retreat in over 2 years, it’s time.

I’m not sure how we can expect boards to be engaged in relational fundraising if the expectation is never set and agreed to and they have never been encouraged or equipped to participate.


Does Your Board Run Away From Fundraising?

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Walking Away from Fundraising

One of the challenges executive directors share most often with me is their frustration with their board members and their lack of participation in fundraising for the organization.

While it’s true that the age and size of an organization will determine distinct roles and responsibilities for its board, the need for meaningful engagement in the development function is a universal board member responsibility. If you’re a board member of a nonprofit, you should be eager to live this out in two distinct ways:

  1. You should be giving financially to the organization you serve, and
  2. You should be introducing others in your peer group to the opportunity to support the organization you serve.

Fundraising Starts with the Board

I often hear, “But I’m giving my unique professional expertise to the organization. That should be good enough.” Let’s be clear—it’s not. If that’s your view, you probably should consider whether you should be taking up a seat. Most corporate and private foundations require 100% financial participation of an organization’s board before they will consider the organization for a grant. It’s about credibility. If you’re truly passionate about a mission, you’ll give to it. You’ll give your time, your talent, your treasure—and you’ll give your influence.

Giving your influence—sharing the mission your passionate about with your family, friends and colleagues—is often the next hardest thing to do. Certainly the executive director and development staff (if any) should be providing compelling entry points for new donors as well as stewarding existing donors with a plan for major gift cultivation and solicitation. However, their work is twice as effective if done in concert with your leveraged influence.

What does that look like? Every board member should agree to introduce a number of their extended family, friends and colleagues to the organization they serve each year. This is as simple as hosting them for lunch or coffee with the executive director or development staff. If your organization has an annual gala, pay for the tickets for your top prospects each year and start there. The lunch can be a follow-up.

“But I don’t know all the details. I can’t remember how many people we serve or even exactly how we do it or what it costs.” That’s why you bring the executive director with you. Each board member should be able to give a meaningful answer to the “Why are you involved with this organization?” question. Let the org’s staff do the heavy detail lifting.

Once you have that first lunch, you’ll find your own commitment strengthened—and you may even have fun.