History of Charities in America

The idea of voluntary, grassroots organizations serving society has been baked into the American experiment from its earliest history. In some ways, this was a core value of the colonial era and has since expressed itself in new and increasingly derived form throughout our history, expressing the changing nature and values of American society.

Benjamin Franklin founded the Junto Club in Philadelphia in 1727, a mutual aid group focused on intellectual and civic development. It helped build roads, a volunteer fire company and a library.  The first antislavery society, the Pennsylvania Society for Promoting the Abolition of Slavery, was founded in 1775, with roots going back far earlier. Benjamin Franklin became its honorary president in 1787. In the same year Free African Society became the earliest known mutual aid society dedicated to helping the Black community.

The variety and complexity of nonprofits grew with American society: the first HBCU in 1837, the Smithsonian in 1846, the Metropolitan Museum of Art in 1870, the Sierra Club in 1892, the NAACP in 1909. While these organizations became household names, they did not arise in a vacuum. They occurred against a backdrop of thousands of other civic nonprofit organizations comprised of individuals engaged in the challenging, rewarding work of building a better society driven by their own ideals and passions.

When the federal income tax came into existence in 1917 it included tax deductions for charitable donations. Since then, through many changes in the tax code, the contribution of nonprofit organizations has always been recognized and incentivized generously. Today, there are close to two million nonprofits registered in the US. They receive donations amounting to 2% of GDP and employ 10% of the labor sector. In 2023 Americans donated $500 billion dollars. Amazingly, the overwhelming majority of this amount came from private individuals. The ideas of civil responsibility, and of personal responsibility for societal change from the colonial era remains a powerful force in social and economic life thanks to the uninterrupted legacy of nonprofits.

Written by Stephen Kelly, Founder, The Giving Law Firm

Questions? Write Stephen@philanthropy-law.com