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It's not exactly a tax deduction though... In the UK, for example, charitable donations are 'tax free' effectively, since the recipient will recieve an extra am
by grkvlt 13y ago
It's not exactly a tax deduction though... In the UK, for example, charitable donations are 'tax free' effectively, since the recipient will recieve an extra amount based on the marginal income tax rate you are paying. The only beneficiary here is the charity, and only if you make an explicit donation from your after-tax income. It's not like the government is allowing you to choose to redirect the tax you're due to charity. In the US, I believe the situation is similar.
- njs12345 13y agoIt's different in the US: 'The taxable income of the donor is reduced by 300 USD. If the donor's income was in the 35% income tax bracket both before and after the deduction, the donor's tax liability (amount of taxes owed to the government) is reduced by 105 USD.' http://en.wikipedia.org/wiki/Charitable_contribution_deductions_in_the_United_States http://en.wikipedia.org/wiki/Charitable_contribution_deducti...
- lmm 13y agoIn theory a donation of $1 in the US is exactly equivalent to a donation of $.70 or so in the UK. But psychologically it seems that people are much more willing to donate more and get money from the government. (The other thing I've wondered about is how much of the US's charitable donations are simply tax fraud).