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Old 08-09-2019, 02:45 PM
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Tax question: Can I ask an employer to directly donate part of my income so I don't get taxed on it?


I recently got a job that pays more than a living wage, and I'd like some of my income to be instead diverted into worthwhile causes. If I get paid and then donate it myself, some portion of it would be lost to Trump's taxes. I don't want that.

Is there a legal way for me to ask my employer to donate the funds directly, taking it out of my paycheck, without paying me first?
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Old 08-09-2019, 02:54 PM
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I recently got a job that pays more than a living wage, and I'd like some of my income to be instead diverted into worthwhile causes. If I get paid and then donate it myself, some portion of it would be lost to Trump's taxes. I don't want that.

Is there a legal way for me to ask my employer to donate the funds directly, taking it out of my paycheck, without paying me first?
You could ask. If you work for a small employer they may be willing to do it so they can have the tax advantages. Most employers probably wouldn't want the hassle.

On the other hand, if they learn they're paying you more than you think you need, maybe they would just cut your pay and pocket the difference.
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Old 08-09-2019, 03:56 PM
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Why wouldn't you just get your normal paycheck, donate whatever you want, and claim the charitable giving deduction on your income taxes?

I would find it hard to believe that donations would be taxed differently based on when you donate them- before or after taxes.
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Old 08-09-2019, 04:06 PM
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Why wouldn't you just get your normal paycheck, donate whatever you want, and claim the charitable giving deduction on your income taxes?

I would find it hard to believe that donations would be taxed differently based on when you donate them- before or after taxes.
One reason
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Not everyone is eligible to deduct.
In order to get the potential tax benefits, you must file IRS Form 1040 and itemize deductions on Schedule A to claim the charitable deduction.

Be aware that changes in tax law in effect as of 2019 make it less likely that it will make financial sense to itemize. The standard deduction has been raised, which increases the possibility that taxpayers may be better off opting to take it rather than to itemize. Further, the so-called SALT deduction for state and local taxes has been capped at $10,000, which also serves to make it more likely that those whose taxes exceeded that amount may opt against itemizing since they, too, may benefit more by simply taking the standard deduction.
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Old 08-09-2019, 05:40 PM
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You can ask your employer to donate some or all of your wages to charity. But you will still be taxed on the donated wages just as if you had personally received them.

The idea is that you exercised control over the money by directing that it be disposed of in a certain way, so it's no different than if you had received the money and sent it to charity.

Similarly, if you request that your employer pay your salary to your children (who are in a lower tax bracket than you), you still get to pay tax on the money your employer gave to your children just as if your employer had given it to you.
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Old 08-09-2019, 08:04 PM
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You can ask your employer to donate some or all of your wages to charity. But you will still be taxed on the donated wages just as if you had personally received them.

The idea is that you exercised control over the money by directing that it be disposed of in a certain way, so it's no different than if you had received the money and sent it to charity.

Similarly, if you request that your employer pay your salary to your children (who are in a lower tax bracket than you), you still get to pay tax on the money your employer gave to your children just as if your employer had given it to you.
Doesn't that mean that every fund manager, who decides where money gets invested or spent, would be taxed on all of it? I don't understand.
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Old 08-09-2019, 08:08 PM
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Why wouldn't you just get your normal paycheck, donate whatever you want, and claim the charitable giving deduction on your income taxes?

I would find it hard to believe that donations would be taxed differently based on when you donate them- before or after taxes.
Is it a one to one equivalence? Like if I deduct $1000 for my itemized contribution, that's considered $1000 less in income? I thought it didn't work like that, but I'm not sure.

Also, there is the possibility that I may want to donate to a 501c4 (political advocacy group) and not a charitable nonprofit. I am not sure how that affects the employer's tax bracket... didn't think that far ahead 🤔
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Old 08-09-2019, 08:23 PM
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Is there a legal way for me to ask my employer to donate the funds directly, taking it out of my paycheck, without paying me first?
Your employer cannot do this legally on the federal level. There are a limited number of fringe benefits, health insurance is an example of a fringe benefit, that are not taxable and you can find them in IRS Publication 15-B.
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Old 08-09-2019, 08:38 PM
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Many celebrities perform or speak at events in exchange for payment. It’s also somewhat common for one of those people to waive their usual fee for charitable organizations they like.

If Bruce Springsteen was approached by a veterans’ group with an offer to perform at a fundraiser in exchange for money, but he waives his fee, how is that different in the eyes of the IRS from the scenario the OP describes?

I mean, maybe it’s very different, but it sounds pretty similar to me. Our hypothetical Springsteen had control of the offered money, but chose to funnel that money to the charitable organization by saying he’d do the work for less than the going rate. Isn’t this effectively a charitable donation to the nonprofit?

Last edited by EdelweissPirate; 08-09-2019 at 08:40 PM. Reason: Redundant phrases are redundant.
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Old 08-09-2019, 08:50 PM
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Does your employer offer a tax-deferred savings plan, like a 401k or a 403b? That way, you pay less taxes and you have money (hopefully) earning interest until you retire, and you won't pay taxes on it unless you withdraw that money prior to age 59 1/2.
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Old 08-09-2019, 09:39 PM
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Many celebrities perform or speak at events in exchange for payment. Itís also somewhat common for one of those people to waive their usual fee for charitable organizations they like.

If Bruce Springsteen was approached by a veteransí group with an offer to perform at a fundraiser in exchange for money, but he waives his fee, how is that different in the eyes of the IRS from the scenario the OP describes?

I mean, maybe itís very different, but it sounds pretty similar to me. Our hypothetical Springsteen had control of the offered money, but chose to funnel that money to the charitable organization by saying heíd do the work for less than the going rate. Isnít this effectively a charitable donation to the nonprofit?
The waiver has to be unconditional to avoid taxes.

If Bruce Springsteen says "You take the money and give it to the Veterans Scholarship Fund," that's taxable. If he says "You just keep the money and do whatever you like," that's not taxable. Once you set conditions on what happens to the money, you had control over it.

For example, here is the waiver that a speaker at Notre Dame University must sign to avoid having their honorarium treated as taxable income.

And, before anyone asks, the value of personal services is not tax-deductible in the United States.
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Old 08-09-2019, 09:48 PM
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Doesn't that mean that every fund manager, who decides where money gets invested or spent, would be taxed on all of it? I don't understand.
I suppose if the conditions of the fund allowed the manager to spend it all on hookers and blow for himself, he would be taxed. But in the case of most funds, the money remains the property of the fund and must be managed on behalf of the fund according to the fund's by-laws.

In contrast, your salary becomes your property to do as you please with.
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Old 08-09-2019, 10:05 PM
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The waiver has to be unconditional to avoid taxes.

If Bruce Springsteen says "You take the money and give it to the Veterans Scholarship Fund," that's taxable. If he says "You just keep the money and do whatever you like," that's not taxable. Once you set conditions on what happens to the money, you had control over it.
Thanks for explaining. I knew the celebrity example must be different somehow. And that Notre Dame form makes a lot of sense in that context.
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Old 08-09-2019, 10:35 PM
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I recently got a job that pays more than a living wage, and I'd like some of my income to be instead diverted into worthwhile causes. If I get paid and then donate it myself, some portion of it would be lost to Trump's taxes. I don't want that.
What the heck are Trump's taxes?
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Old 08-09-2019, 10:40 PM
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Originally Posted by Alley Dweller View Post
The waiver has to be unconditional to avoid taxes.



If Bruce Springsteen says "You take the money and give it to the Veterans Scholarship Fund," that's taxable. If he says "You just keep the money and do whatever you like," that's not taxable. Once you set conditions on what happens to the money, you had control over it.



For example, here is the waiver that a speaker at Notre Dame University must sign to avoid having their honorarium treated as taxable income.



And, before anyone asks, the value of personal services is not tax-deductible in the United States.
Could it be treated as an in kind contribution?
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Old 08-09-2019, 11:41 PM
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Is it a one to one equivalence? Like if I deduct $1000 for my itemized contribution, that's considered $1000 less in income? I thought it didn't work like that, but I'm not sure.

Also, there is the possibility that I may want to donate to a 501c4 (political advocacy group) and not a charitable nonprofit. I am not sure how that affects the employer's tax bracket... didn't think that far ahead 🤔
What you list on your itemized deductions is subtracted from your adjusted income. If you donate $1000 then your taxable income will be decreased by a $1000. If you are in the 20% tax bracket that will net you $200 in saved taxes.
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Old 08-10-2019, 01:08 AM
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What you list on your itemized deductions is subtracted from your adjusted income. If you donate $1000 then your taxable income will be decreased by a $1000. If you are in the 20% tax bracket that will net you $200 in saved taxes.
The problem is that if your itemized deductions plus the charitable contribution add up to less than the new standard deduction, you get no tax benefit from the contribution. That's where I am now. I just donated some stuff to a thrift store and didn't even bother to get the receipt.
That's also why I paid off my mortgage - no more tax benefit.
The higher standard deduction is what has changed.
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Old 08-10-2019, 01:43 AM
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Could it be treated as an in kind contribution?
Yes, but not a deductible in-kind contribution.

If Bruce rents an auditorium and hires backup singers for a charity concert, the amount he spends doing that is deductible. The amount he might theoretically have been paid for performing is not. Even if he can prove that his usual fee for putting on a concert is $x, it is not deductible.
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Old 08-10-2019, 03:27 AM
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The problem is that if your itemized deductions plus the charitable contribution add up to less than the new standard deduction, you get no tax benefit from the contribution. That's where I am now. I just donated some stuff to a thrift store and didn't even bother to get the receipt.
That's also why I paid off my mortgage - no more tax benefit.
The higher standard deduction is what has changed.

But the OP's question about employer directing funds to charity does strongly imply a significant amount, not below the "standard amount". discussions of handling small amounts is not answering the OP.

What answers the OP is a discussion of fringe benefits.

Look, if business ACME LTD says it donates 10% of its profits to some charity,
then you go to work for them, well thats the same as if you are working for them and then ask them to do the donation. I dont see donations to charity being somehow treated as a payment to individuals.

What the employer can be caught on is fringe benefits.

This is where you get free rent and a reduced salary.
If the work place is remote, and you clearly had to move out there for work, it might be exempted. but you can't just get your employer to pay your rent to dodge tax.

See https://www.fundera.com/blog/fringe-benefits

( Well in this country, Australia, people who work for health facilities such as public hospitals, do get $10,000 of exemptions of fringe benefits, so that they do get their rent paid by their employer, and tax is dodged. )
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Old 08-10-2019, 07:56 AM
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You could ask. If you work for a small employer they may be willing to do it so they can have the tax advantages. Most employers probably wouldn't want the hassle.
Bolding mine.

Many years ago I had a new employee approach me right after she was hired, asking telling me to make her pay checks payable to her friend/roommate so that her income wouldn't negatively impact benefits she was receiving.

I told her no. She asked if it was illegal, and I told her I honestly did not know, but I would not spend any time researching the issue.
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Old 08-10-2019, 08:13 AM
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Does your company have a 401K or benefits plan? That would be my suggestion, especially if they have a good matching program. Far, far better to do that than to donate to charity, though I'm not knocking philanthropy.
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Old 08-10-2019, 09:48 AM
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But the OP's question about employer directing funds to charity does strongly imply a significant amount, not below the "standard amount". discussions of handling small amounts is not answering the OP.

What answers the OP is a discussion of fringe benefits.

Look, if business ACME LTD says it donates 10% of its profits to some charity,
then you go to work for them, well thats the same as if you are working for them and then ask them to do the donation. I dont see donations to charity being somehow treated as a payment to individuals.

What the employer can be caught on is fringe benefits.
The average taxable income on US federal tax returns is around $62k. The average of reported charitable donations is around 3%. So the $12.2k standard deduction for single filers, $24.4k for joint filers, is very significant relative to the charitable contributions average people would be talking about. If OP has a much higher than average income OP probably should point that out at least in general terms, since income level heavily affects any tax question.

Otherwise the answer on employer side is as others already pointed out. If the employee is directing the contribution it's still the employee's income for tax purposes. In any other permutation (simply ask the employer to cut your salary and hope the difference goes to charity, seek out an employer with a policy of donating X% of profits to charity*, etc), it's not 'asking an employer to directly donate part of my income'.

The specific tax exemptions for fringe benefits in the US code, which have been whittled down over the decades and are less than in some other developed countries, do not include charity donations directed by employees out of their compensation.

So the simple answer to the thread question is 'no', assuming US federal taxes and any common sense definition of what 'ask an employer to directly donate part of my income' means.

*which in any case realistically is usually a marketing device for some companies which deal directly with the public. If they didn't think those policies would increase sales by appearing more virtuous in the eyes of potential customers attracted by that sort of thing, they probably would not (and should not, actually) do it. Should not because especially if it's a public stock company the profits don't belong to the management, they belong to the shareholders. The shareholders can decide what portion of the profits to give to charity after they receive them as dividends or capital gains on selling their stock. To the extent public stock company managers give away shareholder money to bask in the glow of being viewed as philanthropists, they are committing malfeasance IMO. If they at least quietly intend it to be a marketing device to increase net profit to shareholders after the contributions, it's acceptable. So it's a grey area practically because it's hard to know the managers' exact mix of motivations in giving away other people's money.

Last edited by Corry El; 08-10-2019 at 09:50 AM.
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Old 08-10-2019, 12:19 PM
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I mean, maybe itís very different, but it sounds pretty similar to me. Our hypothetical Springsteen had control of the offered money, but chose to funnel that money to the charitable organization by saying heíd do the work for less than the going rate. Isnít this effectively a charitable donation to the nonprofit?
Aside from what Alley Dweller already very capably explained (thank you), I should also point out that 1) I would be donating to a third party, not to my employer (as in the case of Bruce writing off his donation to the org that hires him) and 2) I would be donating cash money, not time

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So apparently there is a max of 50% of AGI that can be deducted for charitable donations, and also the $12,000 standard deduction to weigh that against. Thanks for that info!


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Your employer cannot do this legally on the federal level. There are a limited number of fringe benefits, health insurance is an example of a fringe benefit, that are not taxable and you can find them in IRS Publication 15-B.
Thank you. I was not familiar with the concept of "fringe benefits." I have no desire to get my employer intro trouble over this.

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Does your employer offer a tax-deferred savings plan, like a 401k or a 403b? That way, you pay less taxes and you have money (hopefully) earning interest until you retire, and you won't pay taxes on it unless you withdraw that money prior to age 59 1/2.
Hmm, I very much doubt I'll live to see retirement age, or that our society will still be intact by then.

In any case, I am an independent contractor.

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What the heck are Trump's taxes?
In the tax alphabet, they come after Obama's taxes Beyond that, this is GQ, so I'll leave it be.

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Originally Posted by Snnipe 70E View Post
What you list on your itemized deductions is subtracted from your adjusted income. If you donate $1000 then your taxable income will be decreased by a $1000. If you are in the 20% tax bracket that will net you $200 in saved taxes.
Ahhhh okay, that actually clears up a lot! I didn't realize that's how it worked. Thank you. Between that and the "fringe benefits" above, it seems like my best option is to just take the money and then donate it after I get it.

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But the OP's question about employer directing funds to charity does strongly imply a significant amount, not below the "standard amount". discussions of handling small amounts is not answering the OP.
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If OP has a much higher than average income OP probably should point that out at least in general terms, since income level heavily affects any tax question.
I'm sorry, I didn't mean to be evasive. I was just asking in general terms because my income is extremely unsteady and unpredictable. In the past, the most I've ever earned was $24/hr as a full-time employee or $30/hr as an independent contractor. Then these last two years, I paid no taxes because I was unemployed/underemployed while going to school.

But suddenly, I was offered a part-time job that pays $90/hr, but the hours are haphazard and the future uncertain. In case you missed it above, I am an independent contractor (IT stuff, nothing shady, just overpaid and more than I need to live). The catch is that some weeks I'm working 40 hours, other weeks 5-10. On paper, if this were a full time job, it would put me into a $187k bracket. But in reality, I have no way of knowing, before the end of the tax year, what my income is going to be. I might not even be able to keep the job for long.

What I'm afraid of is owing, say, $187k worth of taxes at the end of the year, but having donated so much of it through the year that I won't be able to pay my tax burden next April. I am not good at finances and budgeting to begin with, so I'd rather just avoid having to deal with that hassle to begin with. Frankly, if I kept all that money, I know I would just mismanage it and waste it on trivial shit. Hence me trying to send it to a good cause instead of wasting it.

But it sounds like that'd just offload the hassle to my employer, making them jump through hoops, which isn't what I'd want either.

I guess the responsible thing to do is to just wait until the end of the year, look at my income over the whole year, and then donate some portion of that myself -- after, not before, I'm able to calculate my 2019 income with certainty.

Thank you all for the feedback. I do appreciate you covering both the basics and the nuances, as someone with really zero knowledge of tax stuff beyond what CreditKarma asks me to fill in every year.

----------------------------

I do have one further question though: Does the whole 501c4 situation make it any different? If I were to do it myself, then my tax burden WOULD be really high, since none of it would be deductible.

And for my employer, I would assume that this would still be a fringe benefit, and would be an even greater hassle since they can't get any write-offs from it?

Makes me kind of pissed off that corporations can operate with shell companies and foreign tax accounts and give freely to 501c4s and SuperPACs and as an individual I'm basically stuck with the tax burden unless I incorporate myself and jump through loopholes...?
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Old 08-10-2019, 12:40 PM
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What you list on your itemized deductions is subtracted from your adjusted income. If you donate $1000 then your taxable income will be decreased by a $1000. If you are in the 20% tax bracket that will net you $200 in saved taxes.
Right, and it doesn't matter whether you have your employer remove that and donate it prior to you seeing it on your paycheck, or whether you donate it yourself and just itemize it at the end of the year.

Either way, your taxable income decreases by $1000, and you pay $200 less in tax. It just shows up a little different on your tax form at the end of the year.

And it sounds like Saint Cad's example doesn't really apply to your situation either.
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Old 08-10-2019, 03:07 PM
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So, since you said "I'm an independent contractor" -- I am guessing that your employer does not withhold any taxes for you from your paycheck? I'm also guessing that your employer doesn't offer you any of the "fringe benefits" of which you were previously unaware of the existence of, like health insurance? Is this accurate?

Speaking as someone who was an independent contractor for several years: my advice to you is, if you are not already doing so, talk to a tax professional. If you are truly a contractor, you're on the hook for paying your own taxes (as well as the self-employment tax), and a tax professional may help you figure out what your total tax liability is now likely to be for 2019, based on your new income level, and what you should be planning for paying.
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Old 08-10-2019, 06:17 PM
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So, since you said "I'm an independent contractor" -- I am guessing that your employer does not withhold any taxes for you from your paycheck? I'm also guessing that your employer doesn't offer you any of the "fringe benefits" of which you were previously unaware of the existence of, like health insurance? Is this accurate?

Speaking as someone who was an independent contractor for several years: my advice to you is, if you are not already doing so, talk to a tax professional. If you are truly a contractor, you're on the hook for paying your own taxes (as well as the self-employment tax), and a tax professional may help you figure out what your total tax liability is now likely to be for 2019, based on your new income level, and what you should be planning for paying.
That's probably a good idea. I have no idea what a self-employment tax is, and it sounds important.

Is this what H&R Block does? Are there any other good choices to talk to?
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Old 08-10-2019, 09:53 PM
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Just to highlight why this arrangement is still under your control and h dance taxable in your hands : what if you asked your employer for a receipt or note of the donation he made , just in case the IRS comes calling, and the employer says, "Yeah, I donated it to my favorite charity -myself!"

If you're upset by that, it shows that you really thought you were the one deciding where the money was to go, and that's why it should be listed as your income.
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Old 08-10-2019, 10:06 PM
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That's probably a good idea. I have no idea what a self-employment tax is, and it sounds important.
OK...first of all, I am not a tax accountant. And, second, yeah, it's pretty important.

When you're an actual on-the-books employee of a company in the U.S., your employer is responsible for withholding money from each of your paychecks for federal income taxes, as well as state income tax (if your state has an income tax). two ot

In addition to that, your employer has to withhold money from each of your paychecks for two other purposes: your Social Security taxes, and your Medicare taxes. Those two taxes, I believe, are 6.2% of your gross income for Social Security, and 1.45% of your gross income for Medicare (source here), and together, those two are referred to as "FICA taxes."

But, beyond that, in addition to taking those 6.2% and 1.45% out of your paycheck, an employer is also responsible for matching those amounts with their own payments. So, in effect, if you're employed, you're essentially paying 12.4% of your gross income into Social Security, and 2.9% into Medicare, but your employer is paying half of that.

HOWEVER, if you're self-employed (as you apparently are, as an independent contractor), when the company for whom you're doing contract work gives you a "paycheck," they aren't taking *any* of that out of your check. You're responsible for paying your income taxes, but you're also responsible for paying your FICA taxes, too. And, since you are essentially your own employer, you have to pay the "self-employment tax" (i.e., the 6.2% for Social Security and the 1.45% for Medicare that your employer would normally pay).

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Is this what H&R Block does? Are there any other good choices to talk to?
H&R Block is a tax preparing service; they probably do have actual accountants working for them, but I believe that that most of the people who work in the local offices aren't actually accountants.

You may well be better off finding a local independent accountant who does tax work, and would be willing to go through your numbers and give you some advice in a consultation.

Last edited by kenobi 65; 08-10-2019 at 10:06 PM.
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Old 08-10-2019, 11:51 PM
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A number of years back I had a friend purchase a convienance store. He did it on his own. He learned the hard way. His advice. The 1st thing you should do is find a tax lawyer, the second thing is find a business lawyer. His mistake cost him thousands of dollars in taxes that he could have advoided. H&R block is not a tax lawyer.
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Old 08-11-2019, 02:22 AM
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Originally Posted by Alley Dweller View Post
Yes, but not a deductible in-kind contribution.



If Bruce rents an auditorium and hires backup singers for a charity concert, the amount he spends doing that is deductible. The amount he might theoretically have been paid for performing is not. Even if he can prove that his usual fee for putting on a concert is $x, it is not deductible.
Makes sense. Thank you.
  #31  
Old 08-11-2019, 02:37 PM
UltraVires is offline
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Quote:
Originally Posted by EdelweissPirate View Post
Many celebrities perform or speak at events in exchange for payment. Itís also somewhat common for one of those people to waive their usual fee for charitable organizations they like.

If Bruce Springsteen was approached by a veteransí group with an offer to perform at a fundraiser in exchange for money, but he waives his fee, how is that different in the eyes of the IRS from the scenario the OP describes?

I mean, maybe itís very different, but it sounds pretty similar to me. Our hypothetical Springsteen had control of the offered money, but chose to funnel that money to the charitable organization by saying heíd do the work for less than the going rate. Isnít this effectively a charitable donation to the nonprofit?
In addition to what Alley Dweller said, there is the more common sense distinction in that in the first instance he makes money and in the second he does not. Generally making money is income and not making money is not. That seems a huge distinction to me.

But the dominion and control aspect is the key. If I make $1.5 million per year, and I tell my boss that $1 million is plenty, so:

1) give the rest to charity, or
2) keep the money and make my salary $1 million,

then in the first instance, it is my income because I am directing its disposal. I could keep it, I could give it to charity, I could gamble it at the blackjack table. It's my money and just because I chose to have someone else give it to charity doesn't make it any less my money.

In #2 I am disclaiming all interest in the money so that it never comes under my control. That extra $500k remains with my company who could keep it, give it to charity, or gamble it at the blackjack table.

That's the distinction: who has control.
  #32  
Old 08-13-2019, 01:04 AM
glowacks is offline
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A 501c4 donation is not tax-deductible. Only 501c3 donations are.

See a tax professional immediately, and not from a firm that just does tax preparation like you'll see heavily advertised during tax season. You want someone who will go over your situation and be able to tell you how much you should be setting aside. They're not too busy this time of year; they likely have time or have employees that have time to go over your stuff now in the slow season. The best bet is any firm or individual with "CPA" in its name, though an individual with "EA" as a title is pretty good too. Someone with no professional title you're really risking your neck on. You've already missed your first two quarters of estimated payments so you'll probably be facing some penalties regardless unless you don't actually end up making that much.

If you do find a tax-professional, ask them about what retirement plans you can set up so that you don't have to pay tax on all your money now. You should be able to set up around 20% of your total pay (if you're topping out at $90/hr and 2000 hours/year) in a SEP IRA, and you may have other options if you're doing it now as opposed to next year. SEP IRAs are great when you realize too late you want to put some away for retirement since you have until the next October to set them up, but another retirement plan, one that has to be set up by the end of the tax year, might make more sense for you.
  #33  
Old 08-19-2019, 03:58 PM
Mama Zappa is offline
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Not quite what the OP asked for, but the closest I've come to this scenario is with employer-provided life insurance.

The amount an employer can provide (and pay for) is 50,000 dollars. Any amount over that, the premiums must be declared as income to the employee, and the employee has to pay income tax.

UNLESS the employee designates a charity as the beneficiary of the proceeds. II can't find a cite for that offhand, but I think I read it on my company's intranet.

Aside from that, as everyone else has said, can't do it.

Now, the OP could save up his money and donate it to a charity every couple of years, if the donation gets to be big enough to push you over the limit to be deductible.

But really, your best bet is as others have said, save whatever you "don't need now" in a tax advantaged account for now. You can donate some of it later on when you're at retirement age, or you can will it to a charity.
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