What Democrat has argued that?
People who want to drown government in a bathtub have argued that.
Food shelf, should be the government. your local art museum should be on you.
Yeah,I’m confused, too.How is giving $100K to the community via charitable donation worse than giving $30K via taxes?
Nonsense.
Like, literally, does not make sense.
And why did that donation from the Zankels have to be tax deductible?
I don’t think the AMT affects the deductibility of charitable deductions.
What is the difference between giving $70,000 and having the government fund the other $30,000 that it collected in taxes? Well if you get to deduct the donation then YOU are effectively directing how that $30,000 is spent.
Let me try again.
If food banks are being underfunded then there is something wrong with our social safety net and making donations to the food bank tax deductible is not going to fix the problem.
If you want to support the local arts, then support the local arts. Why should you be able to direct how the tax money that you would have paid on your contribution to the local art museum is spent? Those are taxpayer dollars that the government has now given you the power to direct.
The charitable deduction is rife with abuse. Everything from people forming animal shelters to deduct the cost of owning pets to African animal museums that are dedicated to showing off the shit you killed on your last safari.
This is wrong on both fronts. Charitable contributions and mortgage interest (used to buy, build, improve a home) are still deductible even if subject to AMT. There are other phaseouts at higher AGI levels that would impact the deductibility of these items that are independent of AMT.
This is a stupid definition. If cookies cost $10 and I pay $100, I am giving $90 as a charitable contribution. If public school costs $0, and I give them $5K a year while my kid attends, I have made charitable contributions to the school.
I’ve hit that and it isn’t that high - where my charitable contributions start getting phased out. I thought it was AMT that was doing it, but it must have been just my income.
Yes. And that’s fine with me.
From this thread I’ve learned I am a bad person for giving to charity. You are all smart people so I will take your advice and stop.
When the deduction phaseouts were first introduced in 1991 (Pease Limitation) the phaseouts started at AGI over 100K (indexed) regardless if filing married or single. Starting in 2001 with the Bush tax cuts, the phaseout was…phased out. Starting in 2012 as part of the fiscal cliff avoidance, the Pease Limitation was reinstated, however the threshhold was increased to $250K AGI for single, and $300K for married and is indexed for inflation. Much more difficult to hit now.
Yep, I’ve hit it. There have been a few good bonus + capital gains years. I had thought it was AMT that was pulling it (which I’ve also hit - thank you stock options).
Not that I’m really complaining, making $300,000 + a year isn’t something worth whining about. Nor has it changed my donation pattern - but if I were giving $10,000 a shot to organizations, maybe it would.
You, like Mark Twain’s apocryphal cat, have learned the wrong lesson. Nobody, nobody at all, has said anyone is a bad person for giving to charity as they see it, though they may argue about what charity is. If you want to quit giving, and need an excuse, this thread isn’t it.
If the cookies cost $10 and you pay $100 to buy a box of cookies from your daughter, then I don’t think its charitable. You are chipping in. You may be chipping in more than you are legally obligated to chip in but that is what you are doing. It is no more charity than if you bought your daughter’s girl scout troop lunch at the chuck e cheese.
Lets say your kid plays tuba, he is the only tuba player in your local high school. Your local high school has a marching band and the bus ran over the tuba. You donate enough money to buy a tuba. Is that charity or chipping in? After all the school gets to keep the tuba after your kid graduates.
Lets say that you now donate money for the marching band uniforms. is that charity or chipping in?
I suppose at some point you are engaging in charity. Lets say you donate a hundred million dollars to a fund that helps out marching bands across the country, you are probably not just chipping in.
That may be the way the phaseout is written but in effect its really just a surtax on incomes over 300K for couples. Unless you don’t pay and state/local taxes and don’t have a mortgage or you have very high income (or comes combination of the two) it should not effect the tax benefits of charitable contributions.
The way the Pease amendment works AFAICT is that it reduces your itemized deductions by 3% of your income over 300K. So unless your state/local tax and mortgage interest deduction is less than 3% of your income over 300K, the “phaseout” is really just eliminating the deductibility of your state/local taxes and mortgage interest. The marginal effect on the tax benefits of charitable contributions would not exist.
So you are OK if someone zeroes out their tax liability by donating money to their pet charity?
Now remember that the charitable deduction is only available to people who itemize their deductions (most people do not). So it is really only people with higher incomes that can take advantage of the charitable deduction.
The limitation probably has no marginal effect on the deductibility of your charitable contributions because your state/local taxes and mortgage interest deductions absorb more of the limit.
Depends. IANAL, but IIRC, the general rule is that if you get something in return for a contribution, you only get to deduct the portion of the value of your gift over and above what you received. So for instance, if you donate $25 to a charity because if you do, they’ll give you a $10 tote bag, you can deduct $15.
And AFAIK, that principle is true for big as well as small. Getting one’s name on the sports arena of a major university probably has a rather nontrivial value. You could probably find out what other persons or corporations had paid to get their names on the arenas of similar universities, and see whether this guy was paying above the fair market value. If he was, then the difference would be his charitable contribution.
Regardless of what happened later with his daughter. As long as he retained the rights to determine whose name was on that arena. (If he handed those rights back to the university without receiving anything in return, then the value of those rights would be a charitable contribution AFAIK.)
All of your examples are charity except the chuck e cheese item. If you donate cash to the girl scouts and they use it to pay for a troop lunch that happens to be at chuck e cheese, then that would also be charity as long as the girl scouts qualifies as a charitable non-profit. Giving more than you receive in value is charity. That yourself or a relation receives an indirect benefit is independent of the evaluation criteria.
It doesn’t make sense the distinction you are trying to draw.