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Interesting read. But removing the tax exemption for charitable giving would be devastating to countless charities doing good in the community.
Of course. It's an interesting debate, in that the unfettered tax exemption for "pretty much anything that calls themselves a non-profit" clearly has negative consequences, but so does removing it. Trying to thread the needle via policy has obvious issues as well.
I think one of the points of the beginning of the article is that in terms of numbers "the countless charities doing good in the community", or as it put it later in the article "can help empower ordinary people" are, in terms of donations the exceptions. While I don't want to sound dismissive, we shouldn't be creating overall policy based around the exceptions.
Yep. And on the flip side, many charities have zero to little measurable positive impact.
I dont think it would be hard to thread the needle at all. Would be pretty easy to set rules for charities and enforce them in a revenue neutral manner. In other words, no deduction on monies you still control or benefit from. You could also group charities into buckets and cap the amount of deductible donations per bucket.
I think the two portions of your post that I bolded are in direct opposition to one another. That is, one of the issues to which I was alluding is giving politicians the ability to determine which charities are worthy and which are not.
The entire problem with making charities and their donation tax exempt is that you are left with the government deciding what is and what is not a charity. In the Scientology documentary "Going Clear" there is a segment on when Scientology and all of its profit centers were formally labeled "church". Part of that segment is a discussion on how such a decision is hard and whether or not some IRS bureaucrat is the one that should make it. The same issue was at the center of the IRS "Tea Party" Scandal. So maybe the decision is removed from the two conservative employees in Cincinnati creating a short cut as the demands on their jobs become overwhelming and place it higher up in government. Is there such a place in government where such a decision should be made? Absent hiring me I don't really want government picking and choosing what qualifies and what doesn't. And most people seem to agree as with a few exceptions just about anything that wants to get called a charity gets the status. I'd just prefer we go the other way and nothing gets the special tax status. And then work on the little bit (in comparison to the overall scope) of harm that results.
Once again I took too long.
The argument is that the reduction of tax revenues resulting from donations to unworthy charities are borne by taxpayers generally.
Yeah, I’d like to see a breakdown of charitable giving in the US. I get that churches and schools likely get a lot. I wouldn’t categorically write those off as not doing good in the community. And sometimes I hear criticism of rich people donating to the arts. While those donations do not necessarily help the poor, they do nevertheless provide cultural benefits to the community.
