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New Tax Laws May Mean Tough Times Ahead for Charitable Giving – Here's Why

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WASHINGTON – New studies estimate that charities and nonprofits, such as churches, will see big drops in donations in 2019.

The National Council of Nonprofits in Washington, DC says the drop in charitable giving could be as much as $20 billion nationwide.

The reason? New tax laws that are affecting nonprofits across the country. Experts say more people will take the standard deduction as opposed to itemizing.

Dan Celia, who leads Financial Issues Stewardship Ministries, says the reason we may see these changes is because of people's motives for giving.

"I think they're going to have an effect on nonprofits… because there are a lot of people who don't give for the same conviction you and I might give to our church," he said, noting that some are giving for tax reasons.

"Well if they get those tax reasons, those tax issues satisfied by getting a much larger standard deduction, then it's not gonna be worth their while to go through and itemize their taxes like they normally would, including all those charitable contributions," he explained "The end result is gonna be very close to being the same."

Meanwhile, Rick Cohen, who serves as chief communications officer and chief operating officer for the National Council of Nonprofits, says the drop in giving will likely make life especially difficult for smaller nonprofits and by extension the communities they serve.  

"What it means for a lot of those smaller organizations is just a lot of drops by $25 here, a reduction of $50 there," said Cohen. "That's just going to make it that much harder for those groups to continue serving their communities."

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