State of Good for Mar 16, 2026

by | Mar 16, 2026

Weekly insights on donor behavior, industry trends, and what’s shaping generosity
⏱️ 4 minutes | Once a week

Donors & Industry Indicators

Major Donors Pour $22.4 Billion Into Foundations and DAFs.  But Where is It Going?

America’s biggest philanthropists gave $22.4 billion in 2025, according to the Chronicle of Philanthropy’s analysis. But here’s what should grab your attention: much of this money flowed into donor-advised funds and private foundations rather than directly to operating nonprofits.

This concentration of giving creates a strategic landscape worth understanding. When major donors park significant assets in DAFs and foundations, it influences the entire nonprofit ecosystem. These giving vehicles received substantial inflows last year, but the report also tracks how much they awarded to nonprofits, a critical metric for understanding actual money available to organizations doing direct service work.

What This Means for You:

  • Review your foundation and DAF outreach strategies,  these pools represent significant untapped potential
  • Consider developing specific proposals tailored to foundation priorities rather than generic appeals
  • Track which foundations increased their distributions in 2025 to identify more active grantmakers

One-Third of Nonprofits Face Federal Funding Disruptions

The numbers are stark: 33% of U.S. nonprofits reported disruptions due to federal funding cuts, while 66% of nonprofits receive funding from federal or pass-through sources, according to the 2026 State of the Nonprofit Sector report.

This widespread dependence on government funding reveals a sector vulnerability that smart fundraisers need to address. When two-thirds of nonprofits rely on federal dollars, even modest policy shifts can create ripple effects throughout the sector. The disruptions reported by one-third of organizations suggest we’re already seeing these effects play out.

What This Means for You:

  • Assess your organization’s exposure to federal funding changes immediately
  • Develop contingency plans for potential funding delays or reductions
  • Accelerate individual giving and corporate partnership development to reduce dependence on government sources

New Tax Rules Change the Charitable Deduction Game

Starting in 2026, charitable deductions face a new hurdle: a 0.5% AGI floor, meaning donors can only deduct contributions exceeding this threshold, according to Windham Brannon’s tax analysis.

For a donor with $200,000 in adjusted gross income, this means their first $1,000 in charitable giving won’t be deductible. While this might seem modest, it fundamentally changes the conversation around tax-advantaged giving, particularly for mid-level donors who itemize deductions.

What This Means for You:

  • Update your donor communications to reflect new tax realities before year-end
  • Consider promoting bunching strategies where donors concentrate multiple years of giving
  • Focus major gift conversations on impact rather than tax benefits, as the deduction landscape becomes more complex

Why Donors Give?

The Setup:

After analyzing 20 years of gender and giving trends, researchers found distinct patterns in how women approach philanthropy compared to men, according to the Wayne County Community Foundation report. Understanding these differences isn’t about stereotypes,  it’s about meeting donors where they are.

The Psychology:

  • Women donors often seek deeper engagement and want to understand the direct impact of their gifts.
  • They frequently prefer collaborative giving experiences and value relationships with the organizations they support.
  • This insight from two decades of research suggests that one-size-fits-all fundraising approaches miss significant opportunities.

Try This:

  • Create giving circles or collaborative funding opportunities specifically designed for women donors
  • Develop impact stories that show individual beneficiaries, not just statistics
  • Offer site visits and program tours, relationship-building activities that resonate
  • Train your team to have longer, more substantive conversations about program details

💡 Pure Charity’s Fundraisers features make it easy to create & manage recurring donation campaigns.

What's Changing?

Foundations Consider Increasing Payout Rates

The question on every foundation board’s lips: Should we increase our payout rate beyond what was originally planned for 2025? According to CEP’s Current Context Survey, foundations are actively reconsidering their disbursement strategies in response to current conditions.

Why It Matters: When foundations consider increasing payout rates, it signals potential new funding availability. But it also suggests they’re seeing increased need or unusual circumstances that warrant departing from standard 5% minimum distributions. This creates both opportunity and competition for nonprofit fundraisers.

Your Move:

  • Reach out to current foundation funders to understand their 2025-2026 payout plans
  • Prepare compelling cases for why increased foundation support would create immediate impact
  • Position your organization as ready to absorb and deploy additional funding effectively
  • Consider multi-year funding requests that help foundations plan their increased distributions

Philanthropy Grapples with Its Role in the AI Revolution

Can philanthropy meaningfully impact how the AI revolution unfolds? That’s the question Inside Philanthropy posed this week, highlighting a sector-wide conversation about technology’s role in social good.

Why It Matters: This signals a potential shift in foundation funding priorities. Organizations working at the intersection of technology and social impact may find new funding opportunities, while traditional service providers might need to articulate their relevance in an AI-driven future.

Your Move:

  • Audit your programs for AI applications or tech innovation opportunities
  • Develop position statements on how technology enhances your mission
  • Partner with tech-focused nonprofits to access new funding streams
  • Train your team on basic AI literacy to engage in these conversations credibly

Bottom Line

This week’s takeaway:

The nonprofit sector stands at a crossroads between traditional funding sources under pressure and emerging opportunities in foundation giving and tech-focused philanthropy. Smart organizations will diversify aggressively while preparing for new tax realities.

Three actions for this week:

  1. Calculate your federal funding exposure percentage and set a target for reducing it by year-end
  2. Schedule meetings with your top five foundation funders to discuss their 2026 payout plans
  3. Update donor communications to address the new 0.5% AGI floor for charitable deductions

💡 Pure Charity can support your 2026 Fundraising Strategies.

 Reach out, and we can discuss.

Good In Action

Gloria Vargas doesn’t wait for perfect conditions to make a difference. This Florida waitress has served more than 270,000 meals to homeless individuals since 2012, operating largely from her Fort Lauderdale home with her husband and two sons, according to Good News Network.

Starting with “a little bit of spaghetti,” this immigrant from Barbados built a family operation that exemplifies grassroots generosity. No fancy headquarters, no massive budget, just consistent action driven by faith and compassion. Her story reminds us that impact isn’t always about scale; sometimes it’s about showing up, day after day, with whatever resources you have.

The Lesson: Your donors don’t need to be millionaires to create transformation. Help them see how consistent, faithful giving, even small amounts, compounds into remarkable impact. Gloria’s 270,000 meals started with one pot of spaghetti. What could your donors’ monthly gifts become over a decade of faithful support?

💡 Have a Good In Action story that you would like to share?  Respond to this email and share the details.