Every December, my partner, John, and I review our charitable giving and develop a budget for the year ahead. We’ve found developing a budget requires us think about what organizations, including our local congregation, are important to us. Sometimes we add new ones and eliminate others. It helps us prioritize our giving and answers the question, “Are we giving enough?”
How much to give to our congregation is always an open question. I grew up in a home where giving was emphasized. My parents gave beyond a tithe, and I suspect at least 10 percent of their earnings went to their congregation. Should that still be our goal? Generally, a 10 percent tithe to the local church has not been our practice.
Congregational budgets have changed dramatically over the years. In the past, church budgets included giving to Mennonite educational institutions, relief agencies and mission programs. Today, many churches keep the vast majority of funds for internal use.
As a result, our charitable budget allocates a portion to our congregation and additional funds for other charitable organizations. It’s important for us to support Mennonite organizations, so our goal is that 80 to 90 percent of our charitable giving goes to Mennonite-related nonprofits. Our budget always includes a portion for undesignated requests. Last year hurricanes and other unexpected immediate needs compelled us to give beyond our budget.
As John and I discussed our 2018 charitable budget, we realized there’s a high probability we will benefit from the new tax-reform bill. What should we do with these extra funds? As we thought about that, I was reminded of a book by Lynn Miller, The Power of Enough. The book was transformational in that it got me thinking about what my “enough” was. When we retired, we decided we had “enough.”
Instead of a tax cut that will benefit many of us who don’t need it, we both would have preferred allocating money to social programs that help the most vulnerable. But that’s not what happened. So, with “enough” in mind, we decided to increase our charitable budget by at least what we believe our benefit will be from the new legislation. While it’s not a huge sum of money, it’s enough to increase our giving to some of our favorite charities and add one or two new ones.
Many charities fear the impact new legislation will have on donors’ giving due to an increase in the number of people who will no longer file itemized tax returns but use the standard deduction instead. The fear is that without the benefit of tax deduction people will be less motivated to give. While that may be true in some instances, I believe the vast majority of Mennonite donors are motivated by something other than tax deductions.
As I’ve become more familiar with the new law, I’ve realized we can also benefit from our Everence donor-advised fund. Since we probably will not file an itemized tax return for 2018, this year our charitable giving will mostly come from our charitable gift fund that was partially funded by donations in 2017, a year when we will itemize. In 2019, we will then replenish our donor-advised fund to cover our giving for 2020 and itemize again. If this seems confusing, speak to your accountant or someone familiar with charitable gift funds.
The beginning of a new year is a great opportunity for each of us to review our charitable priorities and recommit to supporting congregations and organization that make the world a better place for all of us. Live generously, be joyful.
JB Miller lives in Sarasota, Fla., and attends Covenant Mennonite Fellowship.