Trump's shadow chills donors as nonprofits face dire funding crisis
2 Min Read
Donors are concerned that their contributions to organizations opposing Trump's policies could lead to punitive actions.
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US President Donald Trump speaks with reporters after signing executive orders in the Oval Office of the White House on April 23, 2025, in Washington (AP)
As US President Donald Trump continues to diminish the federal government, charity groups are under pressure to fill in the resulting gaps. However, a looming fundraising challenge—reminiscent of Trump's own power—casts a pall over the charity sector.
According to some organization executives, wealthy funders are fleeing for fear that Trump would target perceived political opponents.
Although the Trump administration has said that it would not pursue anticipated executive actions against NGOs, donor pullout is proving to be a major issue, especially when the federal government cuts funds and enforces work stoppages, which are already curtailing crucial services.
Trump federal cutbacks prompt slashing budgets, staff
Lynn English, co-founder and president of English Hudson Consulting, which partners with numerous NGOs nationwide, including those critical of Trump, reported that the storm of federal cutbacks is forcing organizations that rely on federal funds to slash budgets and staff.
Top administration officials threatened to withdraw the institution's tax-exempt status.
Threats by top administration officials to take tax-exempt status from institutions and NGOs have raised donor fears about supporting causes perceived as anti-Trump, putting them at risk of punishment. According to nonprofit executives cited by The Intercept, they include legal assistance organizations, colleges, and media outlets.
Such threats have had a chilling impact on NGOs working on climate change, racial justice, and gender equality.
Trump and Vice President J.D. Vance have publicly voiced disdain for many NGOs and significant supporters. During his 2021 Senate race, Vance advocated for the revocation of tax-exempt status for big schools and universities.
If a nonprofit loses its 501(c)(3) status, it will be liable to corporate income tax and, in some situations, retroactive taxes. It would also be ineligible for most government and foundation funds, and donations would no longer be tax-deductible, making fundraising much more difficult.
