Regions Head of Community and Market Engagement Leroy Abrahams opened the latest Insights Webinar for Community Organizations session with a message of appreciation for nonprofit leaders marking National Nonprofit Day.
Speaking to nearly 300 nonprofit leaders from across the Regions footprint, Abrahams thanked organizations for their work strengthening communities and noted that thriving communities are essential to long-term economic growth.
The discussion then turned to a topic on many nonprofit leaders’ minds: how a shifting fundraising landscape and recent tax law changes may influence charitable giving. While overall philanthropy remains strong, panelists noted that nonprofits are adapting to evolving donor behaviors, increased competition for support and new rules that could affect how and when donors make charitable gifts.
The Nonprofit Fundraising Landscape
Liz Edwards, vice president of Philanthropy at the Community Foundation of Greater Birmingham, opened the conversation with an important reality check for nonprofit leaders:
While charitable giving continues to reach record highs, the number of people making donations is shrinking.
In other words, more money is flowing into philanthropy, but it is coming from fewer donors. That means many nonprofits are becoming increasingly dependent on a smaller group of major donors, making stewardship and donor retention more important than ever.
That trend creates both opportunity and risk for nonprofits.
Here are some additional key points from Edwards about the current nonprofit fundraising landscape:
- Individual donors remain the engine of philanthropy. Even with foundation grants and corporate support, individual donors account for 64 percent of funding for most organizations.
- Bequests are growing rapidly, with a nearly 20 percent increase. Nonprofits may need to devote more attention to planned giving and legacy-giving strategies as donors increasingly consider charitable gifts through their estates.
- Different-sized nonprofits face different fundraising realities, but all organizations are dealing with inflation, higher fundraising expenses, government funding uncertainty and growing community needs.
- Rather than waiting to see how tax changes affect giving, nonprofits should proactively engage with donors about their plans. Ask about any planned changes in giving, what family members are involved in giving decisions, whether a multi-year commitment would be beneficial or if they’re considering donor-advised funds, appreciated assets or planned gifts.
Overview of the Philanthropic Tax Rules
Two Regions Wealth Management leaders then discussed provisions of the One Big Beautiful Bill Act that may affect charitable giving. Bryan Koepp, Wealth Planning executive, and Steve Sommers, Philanthropic Solutions area manager, reviewed several changes that could influence charitable giving strategies, including estate planning considerations, charitable deduction rules, state-specific tax provisions, corporate giving incentives and scholarship-related tax credits.
Koepp and Sommers emphasized that philanthropic intent typically drives giving decisions more than estate tax concerns. Families who are committed to charitable impact continue to incorporate philanthropy into their estate plans regardless of where exemption levels stand.
They also noted that the new provisions may create opportunities for some donors to increase charitable giving through itemized deductions or a new deduction available to many taxpayers who do not itemize.
Charitable Giving Strategies and Donor Trends
George Gaskin, senior director of Gift Planning & Compliance at the Community Foundation of Greater Birmingham, noted that several longstanding charitable giving strategies have become even more valuable under the new law. He also encouraged nonprofits to educate donors about new giving opportunities and ensure their organizations are prepared to accept a wider range of charitable gifts. Additional key points:
- Qualified Charitable Distributions, or QCDs, which allow donors age 70½ and older to donate directly from their IRAs, remain among the most effective tools. Because these gifts are excluded from taxable income rather than treated as deductions, they are not affected by some of the new deduction limitations in the legislation.
- Think beyond cash gifts. Donating appreciated stock, real estate or business interests can create significant tax advantages for donors while generating larger gifts for charitable organizations.
- With historic wealth transfer expected over the coming decades, bequests and legacy gifts represent a growing opportunity.
As the webinar wrapped up, the emerging theme was that the One Big Beautiful Bill changes some of the tax mechanics of charitable giving, but the most successful nonprofits will focus less on the tax code itself and more on building strong relationships with donors whose philanthropic goals remain unchanged.
Leroy Abrahams summed it up well, saying, “No one gets to avoid taxes, but I love the comment made earlier that we’ve continued to talk about today: ‘People don’t give for tax reasons; they give because they’re focused on the cause’. I think that’s something very important to remember.”
People don’t give for tax reasons; they give because they’re focused on the cause.
Leroy Abrahams, head of Community and Market Engagement at Regions Bank
Miss any previous webinars? See below for summaries of past topics:
Turning Ideas into Impact
Practical Strategy Guidance for Nonprofits. Regions strategy specialists and community partners break down the what, why and how of effective strategic planning.
Building Trust Through Transparency
Why Financial Reporting Matters for Nonprofits. Regions Bank webinar shares best practices to strengthen nonprofit accountability and sustainability.
Building Better Boards
Regions Shares Strategies for Nonprofit Success. Webinar offers practical guidance to help community organizations develop engaged, effective boards.
This information is general in nature and is not intended to be legal, tax, or financial advice. Although Regions believes this information to be accurate, it cannot ensure that it will remain up to date. Statements or opinions of individuals referenced herein are their own—not Regions’. Consult an appropriate professional concerning your specific situation and irs.gov for current tax rules.