According to America's Charities, workplace giving accounts for approximately $4 Billion of the monies raised annually for charities. The numbers are increasing each year, not just due to inflation, but also because more firms realize the benefits of corporate giving. In addition, the use of the charity tax credit contributes to this increase.
Workplace giving accounts for approximately $4 billion of the monies raised annually for charities, reports America's Charities. The numbers are increasing each year, not just due to inflation, but also because more organizations realize the benefits of corporate giving. The use of the charity tax credit also contributes to this increase.
Benefits of Workplace Philanthropy
According to Fortune, "Charitable, philanthropic efforts on the part of employees and employers result in workplaces that are better for business, better for the people who work there and better for the world." Benefits include lower turnover rates, higher employee retention and more engaged employees. Those employees who perceive their organizations as giving back to the community are more than 13 times more likely to want to come in to work, according to the Fortune report, than those who work at firms they don't see as giving back. Charitable giving appears to be a point of collective pride and a team morale builder.
Many studies have shown that employees who work toward common goals build a stronger, more cohesive unit that produces better results. Corporate giving on a team level is one such common goal. As a human resources leader, you know that employees respond to positive feedback and to tracking progress toward goals.
In addition, employees see the positive impact of their giving or volunteer work through direct feedback from those they serve, through the media or simply through organizational updates.
Charity Tax Credits — What Are They and How To Use Them
Many employees aren't aware of the charity tax credit, let alone how to use it. While such credits don't exist at the federal level, a number of states, such as Arizona and Kentucky, allow them. According to CNBC, 33 states now offer these tax credits. These focus on state-related programs, particularly tuition scholarship programs.
Although most of these programs have been in place for years, some of them have been created in 2018 in response to the Tax Cuts and Jobs Act. The goal is to reduce the impact of the $10,000 cap on federal income tax home mortgage deductions. The IRS is proposing changes as a result of this perceived workaround, but the expectation is that these changes won't be significant, as they would greatly harm pre-existing state programs.
Promoting This Tax Credit Opportunity
Since for-profit corporations are allowed to take tax deductions for charitable giving, firms that operate in one of these 33 states can provide matching options to encourage their personnel to give. CHROs can work with their staff to research and provide lists of eligible foundations, agencies or non-profits that qualify for the tax credit to their employees. Such lists can be provided with paystubs, via an IntraNet or in organization newsletters.
To broaden the appeal and deepen the benefits, organizations can further augment personal giving and corporate matching with actual in-person volunteer efforts. Alternatively, firms can contribute monies to a charity for every hour volunteered by an employee.
There are myriad benefits to collective corporate giving. By communicating and promoting the benefits of the charity tax credit, employers can benefit through the increases in productivy and ease of recruitment.
SIGN UP FOR THE SPARK NEWSLETTER