3 ms·
> So he’s going to selflessly donate it to himself to save himself from taxes? What a hero. You don't really "save yourself from taxes" by donating money to ch
by Windchaser 1y ago
> So he’s going to selflessly donate it to himself to save himself from taxes? What a hero.
You don't really "save yourself from taxes" by donating money to charity.
Option A: sell stock for $100, pay taxes of $20, spend $80 on yourself
Option B: donate stock of $100 to charity, and spend $0 on yourself
Which of these options leaves Gates with more money in his pocket to spend on himself?
Giving money away doesn't save you from taxes on your income; you just forego the income entirely. The money is gone. It's no longer yours. Why would you be paying taxes on it?
- ghaff 1y ago>You don't really "save yourself from taxes" by donating money to charity. That's not really true if you have sufficiently appreciated assets and are in a high tax bracket. You can donate those appreciated assets and collect an annuity from some percentage of the face value donation and basically be shielded from any capital gains. See e.g. https://www.fidelitycharitable.org/guidance/philanthropy/charitable-remainder-trusts.html https://www.fidelitycharitable.org/guidance/philanthropy/cha... I'm sure there are other mechanisms as well.
- Windchaser 1y agoI mean, maybe? But long-term capital gains are a low tax bracket, so the “in a high tax bracket” part doesn’t apply. I’m curious what portion of his wealth is even taxable. Remember that Bush Jr did a “capital gains forgiveness” year with 0% long term gains rate. I expect many many many of the wealthy sold and then rebought all their major assets that year.
- philomath_mn 1y agoThe exact same logic applies to any deductible expense, and yet people think they can buy a business vehicle "for free" because it is deductible. IDK why this is so hard to understand.
- swiftcoder 1y agoPeople get confused between deductions and credits, mostly?