How Much The Salvation Army Makes and How It’s Used
With all the income The Salvation Army makes from selling donated items as well as direct contributions from donors you may be wondering how much money The Salvation Army brings in a year.
In 2019 The Salvation Army had a yearly revenue of 3.3 billion dollars, which comes from a variety of funds and income streams.
Data from 2019 Financial Summary
Total revenue: $3,323,009,000
- Direct Public Support: $1,958,750,000
During the holiday season, The Salvation Army runs the Red Kettle Campaign, where volunteers go to a variety of retail outlets ringing the iconic red kettle to collect donations.
There are also year-round donations that The Salvation Army accepts on their website, a lot of which comes from people that donate to support relief efforts when natural disasters hit. The Salvation Army also has other charitable programs but we’ll get into that when we go over how the money is spent.
- Sales to Public: $598,449,000
When you go to a donations center to donate your clothes they get resold to the public at thrift stores and auctions.
The Salvation Army has 1,116 thrift stores in the United States, all selling an assortment of donated goods; mainly clothes, household items, and furniture of decent quality.
Stuff that doesn’t sell at the thrift stores is sold at auctions or sold to recycling companies. Unsalvageable or undesirable items are sent to the dump.
- Government Funds: $393,282,000
You may be wondering why The Salvation Army receives government funds when they get regular donations and make money from their thrift stores.
Like I said before, the money is used to fund a variety of charitable programs and social services. Considering that even private companies receive government grants for taking part in economic activities that are deemed a social good, it is not unreasonable that The Salvation Army receives government funding.
This bleeds into the question of whether or not The Salvation Army, or Faith-Based Organizations in general, are nonprofits. Which we’ll further address when we go over the expenses.
- Investment Income: $88,973,000
Investment income is money that is received in annual payments, whether it’s interest from a savings account or stock dividends from a company.
Typically if nonprofits make income unrelated to their social cause, they’d have to pay Unrelated Business Income Tax (UBIT), but modifications to the internal revenue code exclude investment income as unrelated income, as well as the sale of donated merchandise. So you won’t see UBIT as an expense for The Salvation Army.
Total expenses: $3,712,127,000
- Other Social Services: $1,105,979,000
The Salvation Army takes on a broad spectrum of social issues, helping suffering people all across the United States. This includes finding ways to feed the hungry, shelter the homeless, employ the unemployed, support kids that come from harmful environments, and help everybody with spiritual healing, especially in times of crisis.
Their approach is based on having a grassroots presence in local communities, which allows them to make personal connections, as well as implement tailored solutions that make the most positive impact.
Check out how these social services are applied as it pertains to helping specific communities.
- Corps Community Center: $818,001,000
The Kroc Corps Community Centers are 26 large facilities that offer resources, amenities, and spiritual healing for people of different backgrounds and circumstances. These centers allow individuals to deal with the burdens of their life in an understanding environment with lots of positive influences and activities. Whether it’s troubled kids being able to socialize with their peers through camp activities, or depressed people expressing their problems and exercising their bodies, The Kroc centers are seen as havens of hope for many of the members who were able to turn their lives around.
Check out all of the amenities and community outreach programs of these Kroc Centers as well as some of the inspiring personal stories.
- Rehabilitation: $741,222,000
The Adult Rehabilitation program helps people who are trying to recover from alcohol and drug addiction. These are the people that price and organize all of the donated stuff that is transported to the distribution centers (Adult Rehabilitation Centers). The Salvation Army helps these people by guiding them in recovery and by allowing them to work in the program. Through spiritual healing and social development, many of these people are able to land careers in other fields.
- Management and General: $416,404,000
The Salvation Army has 24,550 employees that they need to pay.
- Residential and Institutional: $388,497,000
The Salvation Army has over 7,565 centers of operation throughout the United States.
- Fundraising: $242,024,000
The Salvation Army spends money on marketing in hopes that it will bring in more donations.
Is The Salvation Army a Non Profit?
To sum up the definitions I’ve read on the internet,
A nonprofit is a business that looks to serve the public as opposed to solely making a profit, because of this, they receive tax-exempt status 501(c)(3) from the IRS.
The Salvation Army declares itself a Christian church and an international charitable organization. It is also 501(c)(3) tax-exempt certified by the IRS. But keep in mind since The Salvation Army is a church it is harder for the IRS to do further tax inquiries. This maybe is one of the reasons why people are hesitant to call The Salvation Army a nonprofit even if it pledges to maintain the highest standard of financial accountability.
But let’s just take the data from the 2019 financial summary as true for sake of argument.
The main argument against The Salvation Army being a nonprofit is that only 82% of its expenses support charitable work. But if you look at the other 18% of the expenses 7% goes to fundraising and 11% goes to paying the employees. If you take money away from fundraising then there will be less money coming in. If you take money away from the management and general you’re taking away money from employees who keep the organization running, most of which make minimum wage. The IRS allows nonprofits to do fundraising and pay their employees reasonable wages.
The only other thing preventing The Salvation Army from being a nonprofit is that nonprofits are supposed to remain politically neutral.
Dating back to the 1800s The Salvation Army’s main priority was helping the poor but since its roots are Christian, The Salvation Army is tied with traditional social values, so there has been a lot of controversies between The Salvation Army and the LGBT community involving gay marriage and discrimination against LGBT people.
Whether or not all of these accusations are true, and a negative reflection of The Salvation Army as a whole is up to you.