To them who have much, more shall be given

The Chronicle of Higher Education reports that the new pension law will offer a charity-related tax break to wealthy people but deny one to the poor, though poor people reliably give a higher proportion of their income to charity.  As the Chronicle explains, "Under the legislation, donors age 70½ and older would be allowed to withdraw up to $100,000 from their individual retirement accounts tax-free if they give the money directly to a charity. The tax break, which would be available for two years under the legislation, has long been a priority for charitable groups. . . .The legislation does not include a charitable-giving provision long sought by many nonprofit organizations: allowing people who do not itemize deductions on their returns to write off a portion of their charitable donations."

So if you have $100,000 to spare, you can avoid all taxes by giving to charity, whereas if you don’t make enough money to itemize, your gifts will come from taxable income.  This shouldn’t be a surprise coming from the same people who believe that if you work for your money it should be taxed (the income tax) but if you inherit your money it shouldn’t (the estate tax).  Thems that has, still gits.

And it’s a disgrace that organized charity, in the person of the president of the United Way, endorses this as "reform."  If the tax system collected enough, organized charity would face a less impossible task.

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2 Responses to “To them who have much, more shall be given”

  1. PB Says:

    Thanks for this post. The national nonprofit trade groups should be embarassed the non-itemizer deduction didn’t pass. Very similar to the minimum-wage debate. Legs up for the rich; make the middle and lower classes fight for every penny.

  2. Nonprofiteer Says:

    Glad I’m not the only one shocked by the way nonprofits are rolling over on tax issues. I’ve linked to your site and hope you’ll link to mine.

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