Tuesday, March 1, 2016
Why Does Giving Skyrocket on New Year’s?
Towards the end of October 2015, we launched the Giving Basket – a tool that makes it easy for our users to donate on our site. In just a few months’ time, we’ve seen more than $5.48 million flow through this tool. Not surprisingly, over 92% of the donations have gone to 3 and 4-star rated charities (the bulk of the remainder of the donations, approximately 6%, went to unrated charities).
Maybe even more interesting than which charities are receiving the gifts, is the timing of the donations. Giving Basket donors gave at a pretty constant rate for most of November. In early December, we see a moderate uptick in giving around GivingTuesday. After that, giving steadily grew as Christmas approached. And then we saw a tremendous spike in giving right around New Year's.
Just how big was this bump in donations at the end of the year? Well, 56% of all the donations that flowed through the Giving Basket in November and December occurred in the last 5 days of the year. And 25% took place just on New Year's Eve. Furthermore, this isn't just a trend seen in our data. Other giving reports show the same pattern.
So, what’s driving all this giving just before and on New Year’s Eve? Although donors often site other motivating factors when asked about their year end giving, it seems that the obvious answer is the charitable tax deduction. That’s because donors who wish to take advantage of this tax break must make their donations before the end of the year.
Whether or not the tax benefits of giving motivated you to donate, be sure you know how much you can deduct, what types of contributions are deductible and how to best itemize deductions on your income taxes. Check out our tips now for help in answering these important questions.