May 22, 2003

 

North Dakotans Continue to Give More

Contrary to the national trend, donations to charities, humanitarian causes, and public and private institutions continue to rise in North Dakota. According to the latest release from the North Dakota State Data Center at North Dakota State University, total reported tax deductible charitable contributions (on tax returns with itemized deductions) by individual North Dakotans were $162.9 million in 2001, compared to $154.6 million in 2000, an increase of 5 percent.

For tax returns with itemized contributions, average contributions per return were $3,187 in 2001, up slightly from $3,172 in 2000. Nationally, average contributions declined nearly 4 percent from $3,627 in 2000 to $3,494 in 2001.

One method of capturing the charitable nature of North Dakotans is by looking at tax deductible itemized contributions on Federal individual tax returns. The Internal Revenue Service publishes selected data (including tax deductible contributions or donations) from individual tax returns filed the previous calendar year by state. "Unfortunately, there are important limitations with the use of IRS data to explore trends in donations or charitable giving within North Dakota," said Richard Rathge, director of the State Data Center. "The two greatest limitations are the small number of North Dakotans who itemize their deductions on the Federal individual income tax return, and that itemized deductions only capture giving that is tax deductible. Nonetheless, the IRS database is one of the few uniform means of tracking contributions over time and by state," said Rathge.

According to 2001 tax data, only 20 percent of North Dakota taxpayers chose to itemize deductions on their tax forms (second lowest percent in the nation). A mortgage is one of the primary reasons for itemizing deductions. Less than half of home owners in North Dakota have a mortgage, the second lowest proportion in the nation. This may explain why 80 percent of North Dakota taxpayers take the standard deduction. For these taxpayers, no details on their donations are available through the IRS.

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Sources: Richard Rathge, (701) 231-8621, richard.rathge@ndsu.nodak.edu
Editor: Tom Jirik, (701) 231-9629, tjirik@ndsuext.nodak.edu

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