Former House Speaker Paul Ryan and President TRump. Photo: Alex Wong/Getty Images

Charitable donations in the U.S. dropped an inflation-adjusted 1.7% to $427.7 billion in 2018, the first overall drop since the Great Recession, according to Giving USA's annual report.

The big picture: Giving by individuals dropped an inflation-adjusted 3.4% to $292 billion as a result of changes in the federal tax law and a dip in the stock market late last year, despite an overall strong economy, the Wall Street Journal reports. Giving by individual Americans had previously grown for four straight years by at least 2.4%. In 2017, U.S. giving exceeded $400 billion for the first time.

The new GOP tax law increased the standard deduction and thereby reduced the number of Americans who could benefit by itemizing their deductions — thus diminishing the "direct federal incentive" to donate to charity, according to the Journal.

  • The number of households expected to use the deduction dropped from 37 million to 16 million after the tax rewrite, according to the Tax Policy Center
  • "Households earning more than $1 million per year nearly always itemize," Axios' Felix Salmon wrote in November. "They accounted for 30% of itemized charitable donations in 2015; expect that number to rise even further."

The bottom line: "Donations tend to rise when the economy and stock market are strong and when natural disasters occur," which wasn't the case this year, WSJ's Richard Rubin writes.

Go deeper: National deficit grew 20% last year, partially due to Trump tax cuts

Go deeper

20 mins ago - Politics & Policy

Biden's China plan: Bring allies

Sarah Grillo/Axios. Photo: Drew Angerer/Getty Images

Joe Biden is planning to confront China across the globe, embracing some of President Trump's goals but rejecting his means.

The big picture: By starting a trade war with China, Trump has fundamentally altered the U.S.- China relationship — and forced both Republicans and Democrats to accept a more confrontational approach towards Beijing.

Updated 2 hours ago - Politics & Policy

Coronavirus dashboard

Illustration: Sarah Grillo/Axios

  1. Health: Fauci says U.S. may not return to normal until 2022 — Trump's testing czar: Surge "is real" and not just caused by more tests
  2. World: Taiwan reaches a record 200 days with no local coronavirus cases
  3. Europe faces "stronger and deadlier" wave France imposes lockdown Germany to close bars and restaurants for a month.
  4. Sports: Boston Marathon delayed MLB to investigate Dodgers player who joined celebration after positive COVID test.

In pictures: Storm Zeta churns inland after lashing Louisiana

Debris on the streets as then-Hurricane Zeta passes over in Arabi, Louisiana, on Oct. 28. It's the third hurricane to hit Louisiana in about two months, after Laura and Delta. Photo: Sandy Huffaker/Getty Images

Tropical Storm Zeta has killed at least two people, triggered flooding, downed powerlines and caused widespread outages since making landfall in Louisiana as a Category 2 hurricane on Wednesday.

The big picture: A record 11 named storms have made landfall in the U.S. this year. Zeta is the fifth named storm to do so in Louisiana in 2020, the most ever recorded. It weakened t0 a tropical storm early Thursday, as it continued to lash parts of Alabama and the Florida Panhandle with heavy rains and strong winds.

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