Non-profits Worry About Falling Off the Fiscal Cliff
Congress has 25 days to reach a deal to avert the so-called fiscal cliff, which is a series of tax hikes and spending cuts set to kick-in early next year, and potentially triggering another recession.
As the fiscal cliff looms, between spending cuts and tax restrictions, non-profits are getting worried they could see funding and donations dry up.
“When I first heard it, I thought, somebody doesn't have a clue what it will do to the nonprofit world,” said Jackie Buck, CEO of the American Red Cross of Central Alabama.
When times are tough, local nonprofits like the River Region United Way say, the community turns to them to provide for the needy.
“Now you're telling people you can write less of that off than in the past, so it really does not give them an incentive to support a local nonprofit,” said Jimmy Hill, Director of Resource Development at the River Region United Way. “And it may stop some giving all together.”
If the “cliff" becomes a reality, there may be more people going over the ledge but far less to go around. Not only will non-profits funding be cut, but Congress could cap tax deductions for charitable giving.
“As big as we are, if we feel it, the smaller agencies really will, and that is too bad because this is a generous community,” Buck said.
The American Red Cross of Central Alabama is one of 46 agencies the River Region United Way helps fund, which impacts more than 140,000 lives.
“When you do the math it comes down to about $39 dollars per person, so it doesn't take a lot of money to help someone,” Hill said.
But the potential cuts to spending and donations won't just hurt the needy and the poor.
“Disasters can happen to anybody, and no matter how much money you have or how educated you are or where you are, you can need immediate emergency assistance,” Buck said.
Which is why non-profits in the River Region and across the nation, are trying to show Congress where the reality of the fiscal cliff will be felt.
“At the end of the day it's not about taxes, it’s not about cuts to spending, it's about people, because are people are ultimately going to be affected by the decisions that are made in Washington,” Hill said.
Since negotiations in Washington are uncertain, non-profit groups like the River Region United Way say the best way for donors to make sure they get a full tax-return, is to give by the end of the year.