Tucson Standard

A new law has helped ensure that Arizona nonprofits continue to receive donations.

HB 2757 allows residents to take deductions on the money they give to nonprofits without having to itemize them on their state tax return. 

The legislation was introduced to counter the effects of new federal tax laws doubling the standard deduction for single and married filers.

Kristen Merrifield, CEO at the Alliance of Arizona Nonprofits, wrote in Inside Tuscon Business that the change in the standard deduction undermined the financial incentive to contribute to nonprofits, significantly reducing annual donations.  

“Heading into our advocacy efforts at the state legislature last year, the Seidman Research Institute at the W.P. Carey School of Business at Arizona State University unofficially estimated that charitable giving in Arizona could be more than $300 million lower as a result of the federal and state changes to standard deductions,” Merrifield wrote.

Data reflecting the total financial impact on nonprofit giving in Arizona for the 2018 tax year isn’t available but donations were most likely less than before the change in the standard deduction, she explained.

Giving USA reported charitable donations decreased last year — the most since last decade’s financial crisis — and that in 2018 individual giving dropped by 3.4 percent in inflation-adjusted dollars following four straight years of growth, according to The Wall Street Journal. 

“So, here we are, a year later, heading into the season of sharing and the only thing that’s really different is the date on the calendar,” Merrifield wrote. “By that I mean, even with the new law, the need to support Arizona nonprofits, at whatever level you’re comfortable with, remains as important as ever.”