Like thousands of other nonprofits in the arts, education, and human services, and other community organizations, more than 2,000 American orchestras are classified as 501(c)(3) tax-exempt organizations. This exemption and the incentive to give private donations are essential for orchestras and other charitable organizations to serve community needs. While the comprehensive tax reform law enacted in 2017 preserves the charitable deduction for those who itemize their tax returns, the number of taxpayers eligible to itemize has fallen dramatically with the near-doubling of the standard deduction. 

The success of a temporary charitable deduction for non-itemizers that was instituted as part of federal COVID-19 relief recognized how important giving incentives are by extending the benefit to all taxpayers. The Charitable Act would restore and improve this provision and have been introduced in the Senate (S. 317) by Sens. James Lankford (R-OK) and Chris Coons (D-DE) as well as in the House (HR. 801) by Reps. Blake Moore (R-UT), Carol Miller (R-WV), Danny Davis (D-IL), and Chris Pappas (D-NH). We call on policy leaders to support an enhanced and extended universal charitable deduction in order to grow the capacity of the arts sector to support communities. Polling data released by Independent Sector shows 88% of voters support permanently restoring the universal charitable deduction for all taxpayers.

Talking Points 

• Orchestras and other nonprofit arts organizations are part of the broader community of approximately 1.4 million nonprofit 501(c)(3) organizations, working alongside hospitals, educational institutions, food assistance programs, and the full array of charitable organizations.
• Support from donors across the economic spectrum is essential to making this work possible, as orchestras respond to the needs of communities and form partnerships through education, artistic, economic development, and social service programs. When examining giving to orchestras by individual donors who are not trustees, there is evidence of a broad base of community support for the orchestras' work; each year from 2010 through 2014, roughly 75% of the gifts made by non-trustee individuals were under $250, including 45% under $100, and another 30% in the $100-$249 range.
• Ticket sales and admission fees alone do not come close to subsidizing the artistic presentations, educational offerings, and community-based programming of orchestras. Pre-pandemic, on average, 40% of financial support for orchestras was derived from private contributions. Without this support, public access to high quality arts programming would be greatly diminished.
• While the initial impulse to give comes from the heart, studies have repeatedly shown that charitable giving incentives have a significant impact on how much and when donors contribute. When charitable giving incentives are scaled back, donations and critical services available to the public diminish.

View a one-pager of Talking Points from the Charitable Giving Coalition highlighting the importance of charitable giving.