Charity Tax Limits

Did you read the article? There is nothing in there that states where the money could be limited. Only the amount. And if you weren't aware already, there are already limitations on itemized deductions today, which limits the amount of charitable contributions you can claim as a deduction. These apply to people making more than average income.

I'll just hand you the Obama bashing hammer once again.......

Of course he knows where your money should go - the government knows better how to spend our money than we do or at least the Democrats do. Obama, Pelosi and Reid decided where the money should go and they don't think that anyone does charitable giving without a kickback (i.e. tax deduction), so if they don't give that then the charities they don't want supported will go by the wayside.

Free market only works without government interference. This Administration is priding itself on doing everything it can to take free market off the market in the name of Stimulus and Economic Recovery. He's doing the same thing to the economy and to our own economic freedoms that people screamed about when Bush chipped away at civil liberties. Apparently it's not OK to know what library books you checked out, but it is OK to tell me how to spend my money.

Considering where free market and economic freedom on the part of the banks got us, I'll gladly take my chances with a more regulated economy thank you.

First, I don't see anywhere in the article where it dictates where to send your money.

That being said the issue of charitable contributions is extremely complex and very costly to the economy. While I applaud the notion of charity this whole area need major reform. The original intent of the charitable deduction was to encourage people to contribute not to reduce our tax base. It has become a big business that in many cases has nothing to do with giving. While I am not sure the way to save money for the federal budget is this particular limitation of the deductibility of charitable contribution there must be oversight. When I was a tax preparer I was constantly amazed at what taxpayers were subsidizing. And if you look into some charitable organization it looks like we are subsidizing the executives more than the actual good works. Like this extreme example:

http://www.charitywatch.org/articles/childrenswish.html


The whole issue of reform in the charitable deduction arena is not new. In 1995 the Tax Foundation put out several publications advocating reform.

http://www.taxfoundation.org/publica...show/1191.html

Personally I think the way to go would be for the charitable deduction to be limited to the actual money that goes to its charitable purpose with maybe a percentage for admin costs. That would weed out "charities" where a large portion of the donation go to non altrustic areas. I guarentee that it would save the government millions if not billions in tax dollars as well as making the charities more transparent. The information is already there on the 990's. The IRS already does something similar with lobby proxy rules.

Don't get me started on this subject! How many of you have actually checked into the charity of your choice and found out how much of your charitable dollar goes to administration and how much actually goes to the charity itself?

I have - a couple I refuse to give to are: MADD (a great deal of your dollar goes to exec/admin expenses) I believe in drunk drivers being stopped but they won't get my money. The charity that gets the TV personalities to show you all the sick and dying children in other countries (Lord, I can't even remember their names right now). Those sick and dying children don't get much of your dollar. They do know how to paint the picture to make folks want to hand over their money though.

So I'd have to agree that governments probably would spend charity dollars better. I don't know how it works in the US, but in Canada all legit charities must be registered with our Federal Government and that's where you can find out if they are legitimate or not. There are many out there that are not even legitimate charities.

I get calls for donations at least 3 times per week at my workplace. Ask them for their registration number to check them out and often they can't provide one but they can find enough suckers that won't check them out to make out like bandits.

Folks in higher income brackets (I'm not one of them ) will try to get tax write-offs by donating to charity. I think they need to be regulated and not allowed to swindle the government out of their rightful taxes that go to run the country.

Actually, that's not a bad idea. A better idea than Obama's idea. I already research my charities with Guidestar and Charity Navigator to make sure my contributions are wisely used. And it's because of their guidance that I DON'T contribute to some who have their hands out. If this type of guidance could be codified in 503(c) then I think the other "non-altruistic" charities would whither and die on the vine, as perhaps they deserve to.

Unfortunately I think they would find enough folks that don't do their research to give them money anyway and they would still make out like bandits.

Omg, looking at our economy at the moment, I could care less about charities...The ex middle class will need charity to survive the way we're headed.

What kind of charity is it anyway if you get a tax deduction? Charity to me is giving without getting anything in return....

Another example of how we put the very rich on a pedastal, using euphemisms such as "charity" when they are doing nothing more than paying their taxes.

What I'm thinking is if certain stiff requirements (like being able to make the grade with the charity ratings organizations) were codified in tax law (in the US that's 503(c) of the IRS code that spells out who can be a charitable organization) so that the organizations that currently "make out like bandits" would no longer qualify for tax-deductible status, while the "good" charities would qualify.

I think something needs to be clarified in this thread: people don't give to charity because they want a tax deduction. If you're going to be in the proposed top marginal income tax bracket of 39.6%, then for every $1000 you give to charity, your taxes are reduced by $396. In other words, for $1000 you give to the charity, your net cost is $604. You have $604 LESS in your pocket, while the charity has $1000 more in their pocket. People give to charity because they want to give to charity. The tax deduction makes it more attractive to give, but it's still a net cost. Saying that rich people give to charity as a tax dodge is just a misunderstanding of the effect of a deduction on net taxes due. If it was strictly a matter of dollars and cents, they wouldn't give anything at all. They'd just pay the taxes of $396 and keep the $604 in their pocket.

How can one give to charity when there are people who are able and qualified to work who are unemployed and struggling to make ends meet? This becomes the #1 priority in a time of crises, instead of focusing on charity we need to focus on helping our middle class...That is what Obama is trying to focus on. I guess most of the people who don't believe in redistributing the wealth would not agree with this though so I see where you are coming from...

You're 100% right, I don't agree with redistributing the wealth. That is the definition of socialism, which hasn't worked in any of the countries that have tried it so far, but apparently we're going to take a big step toward trying it here. Oh thank you so much Mr. President, because obviously we were just too darn stupid to do it ourselves.

As for charity and why it should even matter now? Well, because there's a lot of people in this country and in this whole world who believe that no matter if they have lost a lot, there are people out there who have lost more. No matter if they had to give up their cell phones and cable TV to make ends meet, there's people who have given up their homes. So they will continue to give to charities to help those who need it, even if it is less than they had given before, because it's just the right and civilized thing to do. People take care of each other. Government very rarely actually takes care of its people.

Yes, France and England and Canada by your definition are all socialist. Socialism in an insignificant amount is not a bad thing. The problem is when we get into dictatorships and rule by one crazy man, that is why everyone is crazy afraid of socialism, but it's a misconception..

And since when is that okay? That's the huge problem in the US: people don't expect anything from the government, people are used to fend for themselves. That is not how it works. The government is supposed to take care of people. I don't understand how people in this country are so blinded by capitalism, free market to 100%. No one type of economy/government works when it's by itself. A good government is a mixture of different types of modes of production not only one. That's why a small amount of socialism is healthy.

Don't forget that there are charities whose mission is to help people who need help and so in tough times like these it's all that much more important to give to such charities. Those who have should be helping those who haven't and since in most cases we can't take in a neighbor foreclosed on their home or make a pot of soup to take to the family down the street any more, it's a way for those of us who still have homes and incomes to see that people are helped -- by giving some of what we have to charity and tasking them to distribute it to those who are in need.

They tried this once. They called it "Communism" and it didn't work. It produces dependence. There's a funny thing about human nature: humans want to "fend for themselves." Because fending for themselves means they have opportunity to shape their own future. It's called "Liberty." It's been tried, too, and it's worked pretty good. It produces INdependence. In fact, it's still working -- it's the freedom of the human spirit that will do more to get us out of this than anything government can do.

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Actually it's worked in most of the countries that have tried it, including the US. Any time you have a progressive tax rate coupled with subsidies of any kind for low-income wage earners (including things like the EIC), that is a redistribution of wealth - which fits your definition of socialism. We had a purer form of capitalism back before we had things like social security, unemployment insurance, medicare / etc and I can't say I would like to see a return to that.

Actually, I agree with this in some ways. I don't agree with your premises; I don't agree with your logic; but I do agree with your conclusions -- to a degree. Go figure.

First premise: The US Constitution. It says nothing about the economy. The Constitution gives the people the freedom to determine their own means of exchanging goods and services. If the people feel the need for a change in the economic system, the Constitution says the people have the right to do that. The people have chosen capitalism, because that's what works best. Free markets and capitalism aren't the same thing either. Capitalism refers to the ownership of the means of production; free markets refers to how people exchange goods and services. Yes, of course we need oversight and regulation of both. Oversight and regulation of capitalism to avoid the excesses and misuse brought about by greed. Oversight and regulation of markets for the same reasons. But the two are separate issues. We need oversight and regulation of markets so that we have fair trade. But we do NOT need the government in the business of owning and operating businesses.

Second premise: Ammendments. Ammendments to the Constitution cover situations that the Constitution didn't cover. Ammendments do not modify the Constitution. They are add-ons. Some to extend coverage (several about voting). An ammendment can get more specific than the original Consitution. (Presidential terms) An ammendment can modify or change or cancel an earlier ammendment. (prohibition) Therefore the Constitution doesn't need to be modified for changing ideas. Ideas are just ideas. They come and go. If there's something new that the original Constitution and its ammendments left out, then an ammendment covers that. There's a whole thread devoted to this somewhere back in this forum.

Next premise: dictatorships. Communism doesn't imply a dictatorship. In fact, the opposite. Communism envisions a society in which there aren't an elite class wielding power. In Communism, everybody is equal. The Soviet system was seen as a "bridge" from capitalism to pure communism. Of course, it didn't work, because the whole concept of communism doesn't take human nature into account.

Conclusions: yes, there needs to be some changes in the way the economy is handled; yes there needs to be government regulation and oversight. But oversight is not participation, and that's what they're doing now. Actually, the government getting involved with the businesses they regulate diminishes the disinterested position overseers and regulators should have. They're producing a conflict of interest. So, while I can agree to some extent on the end, I can't agree on the means.

Of course we do not need government to own business like I said I am not interested in communism. And the purely capitalist economy that we have now is not what works best like you said, that's what I've been trying to emphasize. And yes I use the terms free market and capitalism interchangably because in a capitalist economy there is usually a free market, so I guess you are right i was trying to say that the purely capitalist economy that we have now needs more regulations, not the free market, the free market is fine. I was going to say that the constitution doesn't say anything about the economy, but I didn't because the original question was about the founding fathers, they actually did want to stick with a free market/ capitalist economy, especially Alexander Hamilton....But yea I think government should regulate businesses in a way such as requiring them to pay for their employees' healthcare, although they definitely should not own the businesses they have the power to tax as much as they want, and should use that power more often when it comes to business owners, not when it comes to middle class..Now you can argue the opposite and surely some people think that it's more effective but there are too many negative side effects in order for me to believe in it....It's the government that needs to regulate big businesses, not the other way around we do not want big businesses to become more influential to people's lives than the government is, which is what is happening unfortunately...
And about dictatorship, that's actually a misconception that most people have about communism, and I thought this was the case here as well..People mistake communism with what was happening in the soviet union, cuba, north korea when in fact that is not communism....
Although I definitely don't think communism in the way it was intended by Marx is great, I think we can learn a lot from Marx about the mishaps of capitalism and problems with capitalism in its pure form.
It is true that in this country we are moving farther and farther from the notorious pure capitalism that Marx described and that was happening during his time (and so is the rest of western Europe, the US just more slowly), we are still not as far as it would be optimal..