Updated: Jun 19, 2019
What the New Tax Law REALLY Means for Ministry
During these first weeks of a new year, I’ve been struck by how many times I’ve heard comments like these during my conversations with ministry leaders:
“We’re nervous about how the new tax laws will impact giving, so we’ve decided to eliminate our annual missions appeal and put more emphasis on our internal needs.”
“Our leaders expect our giving to go down because of the new tax law, so we’re going to postpone filling our youth ministry position until we know more about our budget.”
“We were going to be moving into a capital campaign to expand our services and eliminate our debt, but our board is skittish now because of the new tax law.”
The passage of the Tax Cuts and Jobs Act has generated enough fear to cause some ministry leaders and their organizations to retrench on mission – and during a period of incredible prosperity. They’ve succumbed to the fear-mongering that some in the nonprofit sector perpetuated during the tax law debate. Some leaders have slipped into a scarcity mentality, assuming that one act of congress will limit their donors’ generosity.
People of faith, aren’t we the same folks who confess
a God of ‘more than enough’? (II Corinthians 9:8)
I know what it’s like to be responsible for charitable gift income during unpredictable times. I was cutting my teeth as a major gifts officer during a $60 million church-wide appeal in 1987 when Black Monday hit. As vice president for advancement at a church-related college, I was leading a $100 million campaign during the Dot-Com Bubble. I was leading a planned giving consortium of 12 ministry organizations and 250 congregations during the recent Great Recession. I know how fears about your ministry's financial future can test your faith.
Yet during all of these difficult economic times, giving for religious purposes either increased, held steady or experienced the least impact of any sector. The organizations I was serving who adjusted but refused to retrench managed to retain their momentum and continued to thrive. The nonprofits who hit the pause button out of fear lost several additional years just trying to regain their stride.
"How do we lead on charitable giving from a position of optimism and abundance instead of fear and scarcity?" you've asked. With the contribution of my wise friend, Dana Holt at HOLT Consulting, I’ve written a short article entitled “Faith, Philanthropy and Federal Taxes: What the New Tax Law REALLY Means for Your Giving”. It highlights three things your donors need to understand and three opportunities your donors might consider.
I hope you will strike while the iron is still hot on this subject and use the article three ways:
Read it and commit the key messages to memory so you can lead with competence.
Share and discuss it with your staff and board so they can move forward with confidence.
Communicate it through various channels so your donors can have clarity, recognize their capacity, and know the joy of greater generosity.
If your ministry isn’t unapologetically inviting all types of gifts during this period of prosperity, other organizations who DO invite them will be their beneficiaries. If you’re expecting that a tax law will inhibit your ability to thrive, don’t be surprised if the best you can do is survive.
If, on the other hand, your ministry embraces the tools of philanthropy and even the tax laws, don’t be surprised by all the good you will be able to do for others.
Let's make room for the God of ‘more than enough’ to move us
from fear into faith, and from scarcity to generosity!