FAQ

Traditionally “philanthropy” has been thought of as only for the wealthy, but the term is much broader than that. By definition, a philanthropist is “one who makes an active effort to promote human welfare.” The Greater Give aims to democratize giving and redefine the concept of philanthropy to include everyday, working Americans who, regardless of their status or circumstance, want to give back to the communities they care about. These are our “Everyday Philanthropists.”

H.R. 4002 is named the “Everyday Philanthropist Act” because it was created to empower everyday, working Americans who want to give back to their communities regardless of their status, income level, or tax bracket.

If you represent a business, organization, or nonprofit you can sign on as a public supporter of the bill here. Individuals can show their support for the bill by posting on social media with the hashtag: #EverydayPhilanthropist.

No. The Everyday Philanthropist Act has garnered support on both sides of the aisle.

You can find the legislation of the Everyday Philanthropist Act (H.R. 4002) here.

The Everyday Philanthropist Act has garnered support from nonprofits, businesses, think tanks, universities, and trade associations. Our supporters include America’s Charities, American Family Insurance, Community Health Charities, Global Impact, Greater Madison Chamber of Commerce, and the National Association of Independent Colleges and Universities.

A Flexible Giving Account (FGA) is a pre-tax payroll deduction for employee giving. Eligible employees would enroll in an FGA with their employer and allocate a portion of their paycheck to be deducted pre-tax for charitable giving. For every dollar that is contributed pre-tax, the employee reduces their taxable income, and the employer lowers company payroll taxes.

An FGA is not like a savings account at a bank. Funds are not docked away. An FGA is intended to serve as a “money in, money out” model, where funds are transferred directly to charities. It is an arrangement in which eligible employees elect to receive a reduction in compensation and have the employer disburse the amount of the reduction to the designated entity.

No, an FGA is not an actual account where funds are docked away. An FGA operates as “money in, money out,” where funds are transferred directly to charities based on the employee’s payroll deduction election.

All employees are eligible to use an FGA unless they qualify as a highly compensated or key employee as defined by the Internal Revenue Code. Employers may elect to exclude employees under the age of 21, employees who have less than one year of service with the employer during the plan year, or employees described by section 410(b)(3)(C) by the Internal Revenue Code.

Employees can contribute up to $2,700 per year into their Flexible Giving Account (FGA) pre-tax. Any additional amount placed into an FGA will still be included in your taxable income.

The $2,700 cap is comparable to the maximum amount employees can contribute to their healthcare flexible spending account (FSA) in the 2019 plan year. The bipartisan sponsors of The Everyday Philanthropist Act recognized that a lower cap will help the bill score better, meaning it will cost the federal government less, and therefore it will be more appealing to Congress. Individuals can elect to contribute more to their Flexible Giving Accounts, but any amount above $2,700 will be included in their taxable income.

FGAs will be administered in much the same way as other consumer-directed accounts, such as Health Savings Accounts and retirement accounts. As such, employers will disperse funds in alignment with government regulations for these other benefit accounts. For example, 401k plan assets are sent to the plan trustee no later than 15 business days after the end of the month in which the money is deducted.

Any organization certified as a 501(c)(3) public charity by the IRS is eligible to receive donations through an FGA. We suggest referring to the approved list of more than 10,000 charities used by the Combined Federal Campaign, the workplace giving program of federal government employees and retirees.

The Everyday Philanthropist Act is not intended to be a partisan issue. Any organization certified as a 501(c)(3) public charity by the IRS is eligible to receive donations through an FGA. However, there is potential for an employer to object to a specific organization or cause to which their employee wants to contribute. We recommend that specific charities should not be excluded for discriminatory reasons.

The Flexible Giving Account (FGA) is modeled after other benefit programs such as Parking, Transit and Dependent Care accounts that many employers already utilize. These can be self-administered or administrated through payroll providers, HRIS platforms, or third party administrators. This leaves little work for the employer, who simply sees the benefits of lower payroll taxes and happier employees!

Congress is currently reviewing the Everyday Philanthropist Act (H.R. 4002) that has proposed the creation of Flexible Giving Accounts (FGAs). We are hopeful that Congress will see the far-reaching benefits of this legislation and approve the bill so that businesses, nonprofits, and taxpayers can enjoy the benefits! You can help push the legislation along by signing your organization on as a supporter here.

No, Flexible Giving Accounts (FGAs) have no minimum requirements. The FGA was created to empower the Everyday Philanthropist, so all contributions, no matter how small, are accepted.

Employers that choose to self-administer FGAs will not incur administrative fees. Third-party administrators may or may not charge for the implementation and management of FGAs.

Donations to charities may have related transaction or processing fees related to the payment method (e.g., check, credit card or online donation), matching gifts, and/or fundraising model (e.g., federation, crowdfunding platform).

Yes, employees can choose a donor-advised fund (DAF) to be the recipient of their donation. Flexible Giving Accounts (FGAs) are intended to quickly disburse funds to charities. Because of this “money in, money out” model, DAFs with a similar philosophy will prove the most impactful in terms of their ability to provide more donations to more charities more quickly.

Flexible Giving Accounts will be included among the benefits of traditional full-time employment, and are unfortunately not a solution for sole proprietors or independent contractors. While we recognize that there are other populations that will not be eligible for FGAs, we believe that the traditional workplace is an important place to engage Everyday Philanthropists. In our shared responsibility model, both employers and employees are encouraged to lean in and make a positive impact on communities. We have seen success with this model in terms of employees contributing to retirement accounts as well as dependent care flexible spending accounts and other fringe benefit accounts.

FGAs are designed for the traditional workplace with reporting on the W-2, and therefore cannot be accessed through an individual’s affiliation with another type of organization. We believe in cultivating a culture of giving through the employer-employee relationship. Behavioral change that begins with an employer transcends to the employee. We have seen success with this model in terms of employees contributing to retirement accounts as well as dependent care flexible spending accounts and other fringe benefit accounts.

We recognize the role that unions have played in the history of workplace giving and charitable payroll deduction. Much like unions implementing automatic payroll deduction to collect dues from wages, employers used payroll deduction to withhold charitable pledges from employee’s paychecks. Union leaders and corporate executives who became overwhelmed by multiple fundraising drives eventually embraced a single workplace giving campaign, which planted the seeds for the largest workplace giving campaign in the nation: the Combined Federal Campaign. Today, with a single ask, employers can encourage employee charitable giving at scale.

While a matching contribution is not written into the bill (H.R. 4002), employers will have the discretion whether or not to financially match donations that their employees make to nonprofit organizations. This is the same practice that employers apply in their current workplace giving initiatives.

No, a taxpayer will not be able to take a tax deduction for charitable contributions that have been donated through an FGA.

Yes, FGAs are intended to be truly flexible and changes can be made on a monthly basis. This is unlike a healthcare flexible spending account (FSA), in which an employee makes an election at open enrollment that is locked in through that plan year, unless a qualifying event occurs. Flexibility will encourage more giving. For example, an employee could elect a new charity to receive funds based on current events or a change in personal circumstances. Employees could also update their elections if their employer expands the list to include smaller, local nonprofits, such as a church or museum.

Your savings depend on your income, contribution, and other factors. To calculate your tax savings, please use our FGA Tax Calculator.

Your company’s savings depend on the number of employees using a Flexible Giving Account (FGA) and their total yearly contribution. To calculate your company’s tax savings, please use our Employer Tax Calculator.

FGA donations are payroll deducted and sent to the approved charity or charities of the employee’s choice. The employer will provide to each participating employee, on or before January 31 of each year, a written accounting of the employee’s flexible giving account showing deposits and disbursements during the previous calendar year. This reporting could be achieved through a box on the W-2, much like dependent care or 401k accounts.

Yes, the nonprofit community currently provides written acknowledgement (receipts) for donors to use in charitable giving contributions. These receipts should be retained for tax reporting purposes.