Americans gave a record $471.4 billion to U.S. charities in 2020, much of it from fortunes made in the technology sector.

Americans donated a record $471.4 billion to U.S. charities in 2020, a large portion of which came from fortunes made in the technology sector.

Total estimated philanthropy - about 70% originating in individuals - was 3.8% higher than in 2019, adjusted already for inflation, according to Giving USA's annual report.

The biggest increase came from foundations, which made donations of $88.6 billion, or $15.6% more than a year ago, at a time when the pandemic took away the jobs of millions of citizens.

Individuals donated $324.1 billion, representing an increase of 1%. Corporate donations, which usually track profits and the ups and downs of the economy, fell by 7.3% to $16.9 billion.

"It was an unprecedented year in many ways," says Una Osili, associate director of research and international programs at the Lilly Family College of Philanthropy. "In March, there was record unemployment, but as the end of the year approached, one of the best periods ever seen in the financial markets occurred, and that brings implications for charitable giving because people donate when they feel financially secure."

A notable jump in donations came from MacKenzie Scott, a writer who was married to Amazon founder Jeff Bezos. Scott has channeled $6 billion to a wide range of educational and social organizations. On Tuesday the 15th, she announced that she has donated an additional $2.7 billion.

"We're all trying to give away a fortune that was made possible by systems that need to change," said MacKenzie Scott. In a July 2020 Medium posting, Scott announced $1.7 billion in donations to nonprofits, including colleges and universities historically attended by blacks and groups fighting for racial and gender equality and economic mobility. Scott also asked for the help of consultants to "immediately accelerate support for people suffering from the economic effects of the crisis." In December 2020, he announced donations of nearly $4.2 billion to 384 NGOs.

Where donations rose and fell in 2020

Jack Dorsey, cofounder of the social network Twitter and founder of the payments company Square, also made a big impact on the world of philanthropy in 2020, when he promised to allocate up to $1 billion pertaining to his stake in Square to an entity that would fund a global relief package for covid-19.

Most recently, Dorsey donated the $2.9 million he raised from the sale of his first tweet in the form of a non-fungible token (NFT) to GiveDirectly, an NGO that helps the poorest parts of the planet.

In 2021, the biggest impact on the world of philanthropy may come from the fallout of Bill and Melinda Gates' impending divorce, depending on the effect of the separation on the foundation that bears the two's name and has $50 billion. Melinda announced in 2020 that Pivotal Ventures, the investment and incubation company she owns, would join Scott in launching the Equality Can't Wait Challenge, which will give a $30 million prize to organizations that come up with ways to empower women by 2030.

In the US Congress, there are also efforts underway to encourage donations from wealthy people to charities in a faster way. The wealthiest usually take advantage of a tax break that allows them to allocate money into mutual funds and also allows them to postpone the decision on giving. The tax breaks for so-called donor-advised funds can be as high as 57% of the amount in question.