Research Report Foundation Grantmaking over the Economic Cycle
Nathan Dietz, Brice McKeever, Ellen Steele, C. Eugene Steuerle
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American grantmaking foundations must pay out a minimum of 5 percent of their investment assets each year for charitable purposes, and they are penalized for dropping below a five-year average rate with a higher excise tax. These rules, combined with many foundations’ tendency to simply pay out at a fairly constant rate, tend to make foundation grantmaking procyclical: payouts decline during economic downturns. This brief covers a conference discussion on whether grantmaking might productively be made more countercyclical and examines changes in foundation grantmaking between 1997 and 2010, largely based on National Center for Charitable Statistics data.
Research Areas Nonprofits and philanthropy
Tags Nonprofit data and statistics Foundations and philanthropy Tax policy and charities Data and technology capacity of nonprofits
Policy Centers Center on Nonprofits and Philanthropy