It is very difficult to predict exactly how the nonprofit sector will be affected by the results of the 2016 election. We have been advised by experts to brace for anything. What we do know is that there are multiple uncertainties and nonprofits need to be prepared for the good and the bad.

In the next 90 days, the selection of Trump's key advisors will be key in determining how we will move forward as a nation, as well as an industry. We have to see who the President Elect is going to surround himself with because the people he selects to be a part of his administration will write the language into the legislation and negotiate the deals with Congress.

Changes in tax policy

One of the major issues that could impact charity, and giving trends, is a change in tax policy. Rise in incomes for the wealthiest Americans could occur under Trump, who has pledged to lower the individual tax rate as well as eliminate the estate taxes on inherited wealth. Equally important, a budgetary stimulus package directed as infrastructure spending could also result in greater incomes which would tend to increase giving. On the other hand, budgetary constraint might mean less public money going to non-governmental organizations. This could create pressure on publicly funded charities to raise more donations from other non-public sources, chiefly, individual donors and corporations.

Some believe that Trump's proposed plan to institute large tax cuts for the wealthy would lead to more giving, as the correlation between charitable giving and economic growth is high. But the Tax Policy Center found that Trump's reform could lessen incentives for giving to charity. With Trump's plan to cut tax rates, the standard deduction would increase; however, Trump might reduce the number of people who "itemize" deductions, including charitable donations, and that could be a disincentive to give.

What do we know?

At this juncture, not much. If the new Trump administration can successfully pass tax reform, which then leads to economic growth, this bodes well for charity. On the other hand, if the charitable deduction is lowered, or itemized deductions are further capped, this could be bad for nonprofits. If budget cutting is imposed and public funds for charities are reduced, that would have short term negative implications.

My basic belief is that the private sector, with the nonprofit community in the lead, does a good job creating real solutions for our social challenges. One ideal scenario is for the significant progress with public/private partnerships seen over the past several years to continue advancing. If public funds lessen, it will be possible to increase private support if the economy grows. This means many of us in the fundraising business will be very busy in the coming days. 

What should Nonprofit Executives be thinking right now?

I always advise strengthening boards of directors with resourceful, networked professionals who can help steer the organization to new donors and partners. Vibrant nonprofits are in a constant state of change, and that starts with leadership. As we learn more about the changes sure to come in our country, keeping an open mind, and preparing to raise more private funds is the wisest advice.

Times of rapid change test an organization's strategic plan and mission compass. In the midst of a new business climate, reaffirm your purpose and narrative. The best nonprofits are clear about their values and mission and can adapt strategies for fundraising and communications as necessary over time.