• Bassman1805@lemmy.world
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    8 months ago

    This is not how tax deductions for charitable donations work.

    1. You round up to the dollar for a 50c donation
    2. The business has 50c extra income
    3. They write off 50c as tax deductible
    4. They pay the exact same taxes whether or not you make a donation
    • droans@lemmy.world
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      8 months ago

      #2 and 3 don’t actually happen since it can’t be recorded on the P&L.

      The donation would get recorded to cash and offset to a liability account, probably something named Charitable Donations Payable likely with a subaccount for the specific programs.

      Overall, the effect is essentially the same, though. Fwiw, I like to use the same comparison as you did to show to people how dumb this belief is.

      The individual who donated at the register also is allowed to claim the donation when they file their taxes.

    • scutiger@lemmy.world
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      8 months ago

      That’s not how it works either. You’re the one naking a donation, you get a receipt for your 50 cent donation that YOU can claim on your taxes.

      The business getting you to make a donation doesn’t get to claim your donation.

    • FeelzGoodMan420@eviltoast.org
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      8 months ago

      This is a pretty good example of your typical misinformation karma whore clickbait ragebait bullshit post. Glad to see these make their way over from Reddit to Lemmy. Rip.

      • Grandwolf319@sh.itjust.works
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        8 months ago

        Another poster mentioned that they can use this to ask for subsidies. Some might not consider tax benefits, but imo it’s tax benefits with extra steps.

        And you don’t even need to think of that, a for profit business only does what it benefits it. So if they ask, it’s mainly for their benefit, not mainly for sake of charity.

        • FeelzGoodMan420@eviltoast.org
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          8 months ago

          I agree that corporations are inherently evil. But misinformation is also evil. Both are bad. We should all strive to explain things accurately. That being said, this is a meme channel so we’re all looking too much into this. Gotta lay back and let the memes flow. Thanks for listening to my Ted talk.

    • Evans@lemmy.ml
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      8 months ago

      Sure, but they also get to advertise that they donated X thousands of dollars to charity, while the truth is that the actual donors get no tax benefits at all. And like OP said, I’d rather use https://charitynavigator.org/ to do my own research before giving money to a corporation to donate to some organization that may be mishandling their funds.

      • eerongal@ttrpg.network
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        8 months ago

        The person who paid the round up donation (i.e. you) is the person allowed to use the donation for their tax benefit. If you save receipts with round up donations, you can deduct them on your taxes, but no one does that.

        • Got_Bent@lemmy.world
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          8 months ago

          It’s difficult for individuals to get deductions for charitable contributions under current tax code. You’ve got to pretty much donate upwards of twenty thousand dollars before any benefits.

          That stated number is different for every situation and is a rough estimate of average of what I see on returns.

          If Trump tax sunsets in 2025, things will revert back to more easily getting benefits from donations, but that’s a long way away and entirely reliant on who’s running the show at that time.

          • eerongal@ttrpg.network
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            8 months ago

            Thats only because of how the standard deduction works; If you have to itemize, then any amount of charitable donations can be deducted (up to like 60% of your AGI i think). Basically anyone needs to “outweigh” the standard deduction with their own deductions, because doing otherwise is worse. Technically i think you could forgo the standard deduction and use your own, even if you don’t go over the standard deduction, but why would you?

            • Got_Bent@lemmy.world
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              8 months ago

              That catch on current code is that they combined exemption with standard deduction. Makes it quite a bit more difficult than the before times.

              I’ll leave it at that as I’m generally overwhelmed with unparalleled Internet tax expertise any time the subject arises.

            • grue@lemmy.world
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              8 months ago

              That’s the point: almost nobody benefits from charitable donations because almost everybody takes the standard deduction, so “but you can get tax benefits for donating!” is a red herring in almost all cases.

      • ricecake@sh.itjust.works
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        8 months ago

        Yup, it’s not about stealing money it’s about stealing goodwill.

        The customers at the grocery store don’t get thanked for donating $50 million to fighting awful childhood diseases, the grocery store does.
        Then they can use that to argue they’re good for the community, and deserve massive tax subsidies when they go to open their next store.

        Unrelated, I’ve talked with people who work in the corporate philanthropy part of a business, and they’re fine. They’re just happy to get to use their position to organize charity, even though they know the point to the business is goodwill not giving.
        It’s other parts of the business that then milk that goodwill in incredibly scummy ways.

        • Grandwolf319@sh.itjust.works
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          8 months ago

          Then they can use that to argue they’re good for the community, and deserve massive tax subsidies when they go to open their next store.

          So there is tax benefits, just with extra steps?

          • ricecake@sh.itjust.works
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            8 months ago

            Yes, but not guaranteed, and usually “somewhere else”.
            Instead of avoiding paying $50M in federal taxes like a lot of people think, they might be forgiven $1M in taxes at the local level, pending some sustained employment level for some duration or another.

            Point being, they’re usually not planning to do the charity to save tax money, but to gain goodwill. They definitely intend to use that goodwill to make or save money later, and a common way is “you want us in your community, don’t tax us in buying the land 🥺”.
            They might also just use it for advertising so people forgive 5% higher prices.

        • cogman@lemmy.world
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          8 months ago

          It’s about stopping centralized programs which would actually address public needs. “We don’t need universal healthcare, here’s a charity that helps people with the bubonic plague!”

          And in the worst cases, it’s a grift for the wealthy. Where the charities exist to do scammy things like pay the founder to fly to luxury resorts to give a talk about why poverty is bad. Or to fund your family members solar manufacturing company. Or to put fuel into your church’s private jet so you don’t run the risk of catching demons from the public.

          • ricecake@sh.itjust.works
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            8 months ago

            I don’t think that’s the intent behind it, but it’s certainly an impact.
            Charity is a stopgap to a systematic solution to addressing a lot of problems.
            Your local food bank isn’t bad, but it does hide the issue of food insecurity behind a solution that isn’t guaranteed to be available to everyone like UBI or expanded food stamp access would.

            Those cruddy charities do exist, but I think usually businesses try to avoid them because of the risk of backlash. The people running the programs usually try to do what they can to pick good charities at the least, since it’s basically all the same to the business.
            Not much that they can do about the CEOs spouse getting a spot on the charity board though.

    • Dkarma@lemmy.world
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      8 months ago

      That’s not how tax filing works. Your #2 is completely wrong that’s not considered income.

      Are you retarded?