Maryland and Virginia’s residents are among the most generous in America, according to the World Giving Index, which also shows the United States as the most generous country in the world over the past decade.
American donors in 2018 gave more than $427 billion to charity, with 68 percent of the funds coming directly from individuals.
Also, according to the National Philanthropic Trust, Americans do more than reach in their pockets to help others. They also contribute their time — and plenty of it. Nearly 63 million U.S. citizens volunteer, serving a combined total of 7.9 billion hours per year, the equivalent of $184 billion of service.
With the holiday season in full swing and philanthropic efforts ramped up, the District-based financial website WalletHub ranked the most and least generous states in America.
Maryland finished third on the list, while Virginia ranked eighth.
The top 10 are Minnesota, Utah, Maryland, Oregon, Ohio, Pennsylvania, North Dakota, Virginia, Washington and Maine.
The District of Columbia was not ranked because it still doesn’t have statehood.
Utah, Minnesota, Oregon, Iowa and Alaska are states with the highest volunteer rate, while Utah, Georgia, Arkansas, Alabama and Idaho are states with the highest donated income, according to the WalletHub study.
Utah, Illinois, New Hampshire, Maryland and Rhode Island had the highest percentage of the population who donated money.
“U.S. nonprofits are impacted by many of the same forces that impact for-profit businesses,” said WalletHub expert Robert L. Fischer, who is also an associate professor and co-director of the Center on Urban Poverty & Community Development at Case Western Reserve University. “Seeking financial donations can be tough when households have limited fiscal capacity, with nonprofits competing for the same disposable income that for-profits want.”
“In an economy with lower unemployment rates, nonprofits may have trouble competing for staff, especially since the compensation they offer is often lower than for-profit employers. Also, when government budgets shrink, nonprofits see increased competition for available government contracts related to their work,” he said.
The 2017-18 Income tax changes at the federal level increased significantly the number of individual tax returns taking standard, rather than itemized, deductions which means that charitable contributions only benefit the donor if they itemize, said WalletHub expert William J. Smith, chair and David A. Johnson Distinguished Scholar at the Richards College of Business at the University of West Georgia.
“So fewer taxpayers are able to receive a tax benefit for making charitable donations,” Smith said. “This reduces the incentive for charitable donations for those families well under the limit for itemizing, and this represents a large number of potential gifts. Furthermore, by reducing the top income tax rate, the marginal tax benefit from donating one more dollar is reduced for every potential donor in that bracket.
“The same can be said for every income tax rate reduction,” he said. “One of the original purposes of the charitable deduction was to encourage more work by private charities.”
Click here to view the full WalletHub report.