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by vacri
4279 days ago
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"all donations are 100% US tax-deductible." The tax-deductability of charitable donations has always sat weirdly with me. It's not exactly charitable if you're not actually sacrificing anything; it's more a rearrangement of your tax allocation. That can be a good thing in and of itself, but if you're going to claim donations on tax, it's not really something you should get a warm, fuzzy feeling for (in my opinion). I have a regular payment to MSF happening every month, and it doesn't really sit right with me that I can claim it on tax (and I don't). On the other hand, this is a good argument against the libertarian dot-point that private charity 'would happen if we weren't taxed so much'. Given that you can offset your tax by your charitable donations, it becomes a zero-sum game, so why aren't people currently donating at the levels libertarians say they theoretically would? In the US, you can deduct up to half your gross income from tax, and given that the tax load is less than 50%, you can at least convert your income tax to charitable donations, and then start this theoretical "extra charity" that would apparently spring into action. |
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Tax-deductible doesn't mean that the money comes straight out of taxes, it means that you don't pay taxes on the donation. So you give $1.00 to get out of your marginal rate, something like $0.28 or $0.35, in taxes.
In order to eliminate your entire tax burden (per your libertarian comment), you would have to donate considerably more than you pay in taxes. You'd have to donate everything you made above the 0% tax bracket (getting down to a net income of about $15,700 for a married couple.) There are actually people who do it -- pacifists who refuse to pay taxes that could fund wars, for example [0]. But even then it's only possible if your income starts low enough.
[0] http://www.nwtrcc.org/practical5.php