5 ms·

Totally not a tax dodge, right?

• dazc 4y ago
  How come? Asking as a UK business that donates to charity.
  • slater 4y ago
    You can write off donations to pay less taxes. The more in charity, the less goes to taxes.
    • dazc 4y ago
      Yes, this is correct. I give £1,000 to charity and gain £190 in tax relief. I do not gain £190, I have still given away £1,000 against keeping £810 for myself. This is a scam?
• PopAlongKid 4y ago
  Yes, it is one of the few examples of "double dipping" allowed under U.S. tax law. The way it works is, you donate some property (not cash) that has appreciated in value. If you sold the property, you would have long term capital gains income subject to cap gains tax rates (lower than regular rates). But if you donate the property, you get the full appreciated value as a donation deduction, but you never paid the tax on the gain! Example: buy stock for $1, keep it for more than one year and it is now worth $10. Donate it, and you get a $10 charitable donation for something you only paid one after-tax dollar for.