> But they are ALWAYS better off (in terms of money received in their bank account) by NOT GIVING TO CHARITY. There is no way to give money to charity in such a

> But they are ALWAYS better off (in terms of money received in their bank account) by NOT GIVING TO CHARITY. There is no way to give money to charity in such a way that you end up with more money than if you had not given to charity. No not necessarily, the charity's purpose itself can be to perpetuate and buoy a particular asset. It can be to develop the market for the asset. Lets say you own a housing community and benefit from the demand and price of that housing community. You can donate cash you have, borrowed cash, an underdeveloped property, a whole house, or even shares of the housing community project. In all of these circumstances you get a tax deduction, and yes that is moved off of your balance sheet. The charity could be formed for the purpose of building out the housing community and now it is funded and can do whatever necessary to make your housing community attractive, raising the value of all the rest of your assets. The charity isn't trying to make money (as revenues) so its doesn't encroach on commercial purposes. As the charity spends it gets no tax deductions aside from its exemption to taxes in general. But your benefit is still long term capital gains. Therefore when you are an individual, the benefit isn't that clear because couldn't you just get the deductions from your own expensable efforts? Typically you wouldn't be the only entity donating to this charity. Other people in your industry would be using it for the same purpose, letting it be an autonomous entity fulfilling its narrow purpose. So then the benefit becomes more clear.