Chatham County has been named the most charitable county in the state in a study by SmartAsset, an online financial consultant service.
Chatham County ranked first among the places in North Carolina with the most generous residents, measured by how much money people donate as a percentage of their net income, as well as the proportion of people in each county who make charitable donations. The counties that fared best in these metrics were the counties that ranked highest in the study.
Using 2021 IRS data, on average, Chatham residents donated 1.49% of their income. The state average is 1.24%. Other counties had higher portions of income donated, but another factor in the study was what percentage of residents give charitable donations. Chatham scored the highest in this category with 14.67% of the population donating; the state average is 5.86%.
The two factors were weighted equally to yield the Charitable County Index score.
This gave Chatham County the highest Charitable County Index score in the state with a score of 45.00. Other high-ranking counties included Orange, Union and Mecklenburg, which also scored in the low 40s on the SmartAsset index.
To determine the amount of money people donate as a percentage of their income, the study calculated the net income of everyone in each county, according to tax return data from the IRS.
The study also measured the total number of individual tax returns that show charitable contributions and divided that by the total number of individual tax returns in each county.
According to the IRS data used in this study, 5,340 tax returns in Chatham County included charitable contributions, out of a total of 36,410 returns filed in the county. The data also shows Chatham County residents donated more than $65 million.
“Chatham County ranked number 1 in North Carolina in terms of the percentage of residents making charitable contributions, and number 12 in North Carolina in the percentage of local income being donated,” Susannah Snider, managing editor for financial education at SmartAsset, told the News + Record. “This shows that locally, residents in Chatham County were more likely to make charitable contributions, according to the tax data.”
Chatham County ranks number 97 in the U.S. out of more than 3,000 counties included in the study.
Teton County, Wyoming ranked as the most generous in this year’s study with a contribution percentage of 10.81% and 15.13% of residents donating. This gave them a Charitable County Index of 100.00. The next closest counties were Morgan County, Utah, scoring 87.42, and Charles County, Maryland, scoring 81.93.
Snider said the data was measured at a county level, so divides between the eastern and western portions of Chatham County could not be accounted for. The study does, however, account for tax rate variation from county to county.
“We included taxes paid in each county as a means of determining the net income in each county,” Snider said. “While Chatham County residents paid less in taxes than residents of Orange, Wake and Durham, those counties maintained higher net incomes.”
Another factor not included in the study was charitable write-offs. Snider said that was made more difficult to measure by the Tax Cuts and Jobs Act of 2017. The act allows a tax credit for employers that provide paid family and medical leave to employees and stipulates a non-profit 501(c)(3) organization is not eligible for the tax credit.
“While taxpayers may write off charitable giving as part of their tax strategy, it’s important to note that the Tax Cuts and Jobs Act significantly increased the standard deduction, making it increasingly rare for taxpayers to itemize deductions and thus write off cash donations,” Snider said. “Until recently, taxpayers were able to write off up to $300 per individual for charitable contributions without itemizing. Some taxpayers may also work with a financial advisor to execute more complex strategies such as donating appreciated stock.”
2021 marks the second year in a row Chatham County has ranked number 1 in North Carolina, and the fourth consecutive year it has ranked within the top three counties in the state.
For more information about the study, visit smartasset.com/retirement/financial-advisor#us/mostGenerousPlaces-2.
Reporter Ben Rappaport can be reached at brappaport@chathamnr.com or on Twitter @b_rappaport.