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What's the charitable tax-deduction worth? [The Reply]

December 20, 2011 |  1:24 pm

DonationsIn Sunday’s Op-Ed pages, Jack Shakley wrote that President Obama shouldn’t just reduce the top charitable tax deduction to 28%. “It's time to do away with the charitable deduction altogether,” he wrote, arguing that the tax deduction wouldn’t erode philanthropy but would significantly reduce the national debt and “remove an often abused and possibly unconstitutional section of the tax code.” Readers haven’t responded kindly to Shakely’s Op-Ed, so he’s continued the conversation on our discussion board, reiterating his view that the deduction isn't what compels philanthropy.

Some [commenters] seem to think I'm against nonprofits. I'm not. We should support the NAACP, Sierra Club, AYSO, AARP and other charities just as we do now. I'm also not pro Big Government. In fact, I want the government to get the hell out of our churches and other charitable institutions.

Did you know that 70% of all American taxpayers don't get any deduction for their gifts to charity? They take the short form. The richer you are, the more the government underwrites your largess. That's nonsense.

He also responded to the commenters who took issue with the idea that nonprofits can't be advocacy organizations.  There is a distinction: Donations in support of advocacy are not covered by the charitable tax donations:

There are more than 25 types of nonprofit organization, from universities to country clubs and cemeteries. Some nonprofits, called 501(C)4 nonprofits, can and do lobby [and advocate for their constituents], but gifts to them are not deductible. Some organizations like AARP have both a 501(C)4, and a 501(C)3 [arm]. The AARP Foundations can accept tax-deductible contributions.

If this sounds confusing, that's because it is.


Let's can the food drives

The homeless on the holidays: Some food for thought

Don't inhibit people from making charitable donations

--Susan Brenneman

Photo: In an annual Christmas ritual, Father Maurice Chase hands out money in downtown Los Angeles to people who could use a little generosity. Credit: Christina House / For The Times

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