Charitable deductions
Yesterday in the gym the director of the YMCA asked me how people are handling the changes to charitable deductions. I had to share my despair. "I feel like I'm kicking them in the gut." This is going to be catastrophic to charities, and none-to-good for the humans who are my clients.
Here's how it goes. They tell me proudly what they gave - it's a moment of personal reckoning for most people and they LIKE the accountability of telling me. Often times I'll comment on how to be wiser at giving or some personal financial lifehacks. There's a discussion about values that relates to saving and investing, too. But this year when I reply that we can't deduct it anymore, they go through three steps. They wince, they sigh, and then I see the click in their brain as they think to themselves, "no need to push to get this done in December anymore, then."
But they perk up when I tell them about an idea I've had. I propose that we modify this tax act - as it WILL be modified, there are too many flaws - to make an above-the-line adjustment to gross income for charitable contributions up to 10% of your gross income. It would go right next to the deductions for teacher's supplies and IRA contributions.
EVERYONE loves this idea. Everyone. If you are already itemizing you were getting this deduction anyway, so this change is squarely aimed at middle-class tax relief that encourages their small gifts. Republicans might like it because they feel that more jobs should be done by charities versus government. Christians might like it because they've been enjoined to tithe 10% of their salary to charities and it feels mean to make them pay taxes on it first. Democrats might like it because they work for not-for-profits that are going to be decimated by the lack of middle-class contributions.
This is a winning suggestion and I need to get it to the Halls of Power. Help me push it along, would you? Thanks!
Here's how it goes. They tell me proudly what they gave - it's a moment of personal reckoning for most people and they LIKE the accountability of telling me. Often times I'll comment on how to be wiser at giving or some personal financial lifehacks. There's a discussion about values that relates to saving and investing, too. But this year when I reply that we can't deduct it anymore, they go through three steps. They wince, they sigh, and then I see the click in their brain as they think to themselves, "no need to push to get this done in December anymore, then."
But they perk up when I tell them about an idea I've had. I propose that we modify this tax act - as it WILL be modified, there are too many flaws - to make an above-the-line adjustment to gross income for charitable contributions up to 10% of your gross income. It would go right next to the deductions for teacher's supplies and IRA contributions.
EVERYONE loves this idea. Everyone. If you are already itemizing you were getting this deduction anyway, so this change is squarely aimed at middle-class tax relief that encourages their small gifts. Republicans might like it because they feel that more jobs should be done by charities versus government. Christians might like it because they've been enjoined to tithe 10% of their salary to charities and it feels mean to make them pay taxes on it first. Democrats might like it because they work for not-for-profits that are going to be decimated by the lack of middle-class contributions.
This is a winning suggestion and I need to get it to the Halls of Power. Help me push it along, would you? Thanks!