Giving and Taxes


I recently had a discussion with a young man about giving and its relation to tax filing. I thought, since tax season is upon us, it would be worth making an entry based on our talk.

So the proposition made in our discussion was that taking a deduction on your taxes for charitable giving is the same as giving for the purpose of the tax deduction.  My position on the matter created a defined line, at least in my mind, between the two - the giving and the deduction. However, thinking through the matter did challenge my perceptions on the subject.  I thought it interesting that this young man would have such a solidified viewpoint on the matter. In his mind, there seemed to be no question that if a person gave, regardless of their motive, and then took a tax deduction, their giving was tainted by the benefit of paying less taxes.  Frankly, after thinking it through I could certainly feel some leaning toward his persuasively argued position.

At eMite we provide Donation Receipts to our donors for the purposes of reporting donations to the tax authorities.  This is done to help our eMiters with their tax filings. We most certainly do not hold to this practice in order to diminish the giver’s contribution or to somehow change it from what it should be - a willing and joyfully given sacrifice, to just some kind of personal tax benefit.  But looking through the data on giving in the U.S. it is possible to see the statistical support of this young man’s argument. A couple of noteworthy stats include:

  1. Just under ⅓ of all annual giving is done in the last month of the year.  

  2. 10% of all online giving happens in the last 3 days of the year.

Now, while these stats make a compelling argument that people may be trying to get their donations in to secure their tax deductions, there could be other reasons for this trend in giving.  For one, there is the possibility that people are moved more to give during the holiday season. After all, Giving Tuesday is at the very end of November and Christmas does tend to promote a generous attitude.

However, it is very much true that people are in need all year long.  There is no shortage of need in June as opposed to December. So why is giving not spread evenly among the months?  Well, another argument may be based on the fact that people are procrastinators. This is true in many, if not most, instances.  However, procrastination, in and of itself, is not a valid explanation for the lopsided giving reported at the end of the year. If we cared about giving, we would give when the need was made evident, and needs are not waiting around for December to hit.  What about this last 3 days statistic? That is is a huge number! What is so special about the last 3 days of the year?

That stat right there is very hard to refute as it related to giving and deductions.  It would definitely support the idea of people last minute giving to meet the end of year cutoff for charitable giving deductions.  But does it eliminate the possibility of people desiring to give, not based on deductions, but based on a willingness to help?

Ultimately the truth behind the motivation to give can only be revealed within the heart of the giver.  At eMite we see nothing wrong with receiving a tax benefit for your charitable giving. Seems like a smart move to report your donation activity if the governmental authority is willing to give you a break on your taxes for it.  However, there is so much more to giving than a tax benefit. This much more should not be forfeited by the giver by making it about a tax break.

We encourage everyone to give all year long - whenever needs are made known and for the sole reason of helping others.  Give because it is a wonderfully beautiful thing. You will be sure to be blessed when you give freely and willingly.

Scott Toal1 Comment