fundraising taxes

Giving Back to the Community

Make a Difference in People’s Lives
co-authored with Joshua Darland

“Man is paid in direct proportion to the service he renders mankind.
The same applies in business, you have to give to get what you would desire

                –  Thomas Wilhite

Why give?
Many companies and individuals look at charitable donations as discretionary.  So now that the economy has tanked, cash flow will be a problem for many non-profits.  With a large number of non-profits in metro Phoenix, we could see a number of them disappear.  It’s the principle of Darwinism; only those non-profits which can strategically grow and diversify their revenue streams will survive.

For companies, there are two approaches to giving.  Companies give for social good and business development purposes.  Under the first approach, company owners support a non-profit, because its activities or values reflect those of their own.  Feeling good is important.  Under the second approach, company owners support a non-profit, because it provides opportunities for business visibility.   We often see this with the arts and sports, where playbills, uniforms, and facilities lend themselves to branding and sponsorship.

There are no hard and fast rules, however, and the approaches can be mixed.   For example, a company may captain a table at an HIV fundraiser for visibility purposes or a company may sponsor the production of a play simply because its theme resonates with company owners.

For individuals, giving is often more closely tied to the “feel good” approach.  We want to give and we desire to help.  And it isn’t just money that individuals contribute (discussed later).

If you want your contributions to make the most impact, then you need to be selective on how you give.

Here are some guidelines to help you choose a good match for your efforts:

  • Ask your family, customers, and colleagues who they support and why.
  • Consider the size of a non-profit and where you fit in.  There is a big difference in size between the Red Cross and the Nearly Naked Theater.  Do you prefer to be a small fish in a big pond or a big fish in a small pond?
  • Follow-up with those non-profits that you have previously donated to.  See how they used those silent auction items, banners, ads, and money.  Did they deliver as promised?   And if you were looking for business visibility, what was the return on your investment?
  • Ask non-profits about their finances.  Find out where they get their funding and ask if they have money in reserve.   Do they have a strategic plan?
  • Look at the timeline of a non-profit.  The local arts and theater season runs from fall to spring – is this when you want visibility?
  • Does the non-profit provide for client entertainment or other options that will help you grow your customer relationships?

Make a big impact and help your business visibility
Besides money and time, an extra pair of hands can make a big impact and help your business visibility.  Many non-profits use volunteers to deliver their services, plan and coordinate events, serve as guest speakers, host parties, answer phone calls – the list is endless.  And don’t think you have to commit a lot of time.  If you are clear in communicating what your time commitment, level of involvement, and desired benefits for your support are, you can negotiate a very effective partnership that deepens your connection while furthering your business visibility.

Tax benefits are another factor to consider.  Contributions of cash and property may be deductible, as is the mileage it takes to get to and from non-profit activities.  There are tax credits for contributions made to help the poor, K-12 schools, and tuition programs.  Plus, if it fits you, there are gifting guidelines to transfer larger amounts tax-free.

Here in the Valley, non-profits make a difference in people’s lives every day.  They provide shelter, health, sports, arts, business, spirituality, and animal services, amongst many others.  They serve our community, our families, our neighbors, and our friends.  They contribute to our quality of life and the betterment of our future.   For this year, why not help those who help all of us.  You never know – you just might get a boost for your business too.

Joshua Darland has helped a number of non-profits in the past, both as an employee and a volunteer, and is currently moving into biotechnology.  He also has a master’s degree from ASU. 

Support Arizona Schools

Arizona allows individuals to donate, up to $200, to any K-12 school and take that same amount as a credit on your state income tax return.  You can choose the school and designate how the funds should be used.

Money can go to any public or charter school.  To give, find the tax credit form on the school’s website.

Here are a couple of good schools to consider: