Determining how much to give to charity is a personal choice. The only legal requirements for giving levels relate to private foundations, which are required by federal law to pay out annual grants totaling a minimum of 5 percent of their assets.
INDIVIDUAL GIVING LEVELS
The appropriate charitable giving amount will be different for every person. Deciding how much to give to charity can be influenced by many factors beside your financial picture, including your family situation, retirement goals, and personal values and passions. A professional advisor can help you determine your appropriate charitable giving level.
In addition, here are a few resources that may help you get started:
- Network for Good's "How Much to Give" has a simple calculator and a Q & A on donations and taxes.
- GuideStar's "Questions to Ask a Nonprofit Before Investing in It"
- Smart Givers Network's "Questions to Ask Charities before Giving"
- "The Stages of Giving" by Kenneth N. Dayton tells the story of a lifetime of giving in the words of Ken Dayton. He and his wife, Judy, started out in 1945 giving $1,250, and their gifts to date total over $100 million. In this publication, Dayton shares his nine-stage giving process to help others learn how to move from what he calls a minimal response to a creative and thoughtful maximum giving strategy. To order, contact the Council at 860-525-5585 or ccp@CTphilanthropy.org.
CORPORATE GIVING LEVELS
A company's decision on how much to give to charity can be influenced by its annual profit levels, long-term strategic giving goals, business priorities, and a host of other factors. Some companies target a specific percentage of their pre-tax profits to donate to charity each year, others do not. Some companies try to give the same percentage of their pre-tax profits to charity each year, while others vary the percentage year by year.