With Charity for All

‘Tis the season for giving, and the giving season—tax season—also is upon us. Writing a check or checks to charities?

More and more I am less inclined to make a donation to a recognized charity that according to the current tax code would allow for a deduction from my income.

An obvious caveat: That explanation defies the labyrinthine complexity of the tax regulations. Please seek help from—oh, what is the phrase—tax specialists. Thank you, The Management

Should my neighbor’s house be damaged by fire, I would gladly help with the cleanup and help out with expenses as best I could. Were I to organize a neighborhood cookout to raise additional funds, I would certainly pay for food out of my pocket.

None of these expenses qualify lawfully as charitable donations. Fine by me.

My check sent to the American Red Cross for South Carolina flood relief efforts, however, does.

The donation sent to Oxfam International to aid in earthquake recovery in Nepal? Check.

By the way—uh oh!—the management and spending of international funds by the Nepalese government—to put it charitably—has been a disaster. Political discord, don’t you know.

Help out a family member? Help out a colleague? Nope and nope.

At issue for me is limited financial resources. Maybe that phrase is an oxymoron since no one has unlimited bucks to distribute charitably or otherwise.

So for the first part of the year my list of charitable deductions to be reported to the IRS is a hodgepodge of local and state and national organizations, but now I am more likely to give to family, friends, and neighbors.

Certainly, I understand in the abstract how the neighbor of my neighbor’s neighbor is my neighbor. And I guess I can understand the economic merit of a charitable tax-deduction as a gift that gives in both directions to a degree. My question—a simple one admittedly—is whether folks manage charity for tax reasons when they would rather give elsewhere regardless of taxable income outcomes. 

Some studies suggest about half of us do factor in the deduction as we donate, although the percentage varies greatly based on family income. The higher the income, the more the tax implications matter. Apparently, the code was designed in 1917 to offset taxes for the wealthy when the top bracket was set at 67% to help fund the war effort.

Yep, 67%. I can nearly hear the grinding of teeth. Some of y’all may be offended by the notion even as you are nowhere near the top income bracket. I had to check, of course—the 4% bracket for me back in the day when adjusted for inflation. As income taxation increased for those earning less—again, to fund a war—the deduction became more valuable to more households.

To me, seems a bit perverse to value a more technically complex type of giving over a simpler gesture, but then to say any more about the tax code is to set my hair on fire. Metaphorically.

Maybe I’ll just go with the maxim to give when you can give. Or, to choose another word, share when you can share.