How donors get tax receipts for Facebook fundraisers

GoodUnited
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September 30, 2022

Facebook charitable giving tools are an increasingly popular way for users to raise money for, and give money to, their favorite nonprofts (called peer-to-peer fundraising). Many nonprofits worry that they need to find a way to send a tax receipt to each person who donated to a campaign. The good news is, Facebook sends tax receipts for you. (However, it would be great to have the email and mailing address for donors and campaign owners though.)

Read: How to find and thank top donors to Facebook Fundraisers

Read: How to find and thank top Facebook Fundraisers

When a donor makes a contribution to a campaign, Facebook sends an email to the address listed on their account. The email states their donation was a charitable contribution and they didn’t receive any goods or services in return.

Tax Reform: Are Facebook donations still tax deductible?

The answer is yes – but for many Americans it won’t make sense to itemize anymore. Here’s why:

The Tax Cuts and Jobs Act of 2017 reduces the marginal tax benefit of giving to charity by about 25%, and raises the after-tax cost of donations by about 7%. This will likely change the motivation for giving to charity on the whole, especially for those who give specifically for the tax break.

The Act lowers individual tax rates, thereby reducing the value of charitable contributions. It also caps state and local tax deductions at $10,000, but increases the standard deduction to $12,000 and $24,000 for individuals and couples respectively. It won’t make sense for most low and middle-income individuals and families to itemize anymore. In fact, only 5.5% of middle-income households, which make up a large part of Facebook’s demographic, will be eligible to itemize.

Still, the operating theory is that donors to Facebook fundraisers aren’t donating for the tax cut; their motivation is more socially and emotionally motivated. Those who donate for a tax break tend to do it in larger chunks, and at the end of the year as part of an overall financial strategy.

Nonprofits aren’t likely to see a reduction in the amount and frequency of donations to their Facebook fundraisers. The good news is, either way, Facebook does the paperwork for you.

Want to learn more? Read or download The Ultimate Guide to Facebook Fundraisers.