A random curiosity...

[usernamenumber]

Someone on FB made a comment suggesting that if the rich were taxed less they'd give to charity more. You'll probably not be shocked to learn that my initial reaction to this was skeptical, but it did get me thinking: assuming that most people giving nontrivial amounts of money to charity are savvy enough to claim those donations on their taxes, surely there is information out there that could be used to see whether or not this claim is historically accurate. It should just be a matter of correlating charitable donations claimed by the upper income brackets with the taxation levels on those brackets. Heck, I'd also be interested in seeing whether whatever trends are seen there are consistent or differ by income. I remember when I filed my taxes last year, Quicken was able to show the amounts I donated relative to others in the country, so I assume that this sort of aggregate information is a matter of public record... somewhere. The problem is that my usually-sufficient google-fu is failing me (also, I'm at work and can't spend all day on this). I even tried digging into irs.gov, but needles to say that venture was fruitless.

It occurs to me, however, that I have enough flisters who do some combination to money stuff and library science that perhaps one of you might have some idea where this sort of information could be had. I've also sent an email to the info@ address for an organization that advises charities and seems to do a lot of munging this sort of data.

In any case, if I find some interesting result, I'll post it here...

Comments

[breakinglight11.livejournal.com]

I have no useful data on the subject, but purely anecdotally I know more than a few people who are inclined to charity but resent when they are forced into it. For example, I know Jared's dad to be a pretty big tipper, but is offended by the notion of suggested gratuities-- when he sees them on a restaurant bill, he tips exactly that amount, when if left to his own devices he would probably have given more. I am not a rich person myself, but personally I can understand not liking when things are demanded of you, or when control is taken away, and those resentments alone curtailing what would otherwise be generous instincts.

[tpau]

anecdotal evidence here as well. when i owe taxes in april i do not do charities. when i get money back i generally donate all of my refund to charity of my choice.

[sharkpoof.livejournal.com]

thats still a deduction on next years taxes ;)

[unwoman.livejournal.com]

Lots of rich people donate to charity because it's tax-deductible. If they were taxed less, there'd be less incentive.

[elusiveat.livejournal.com]

I've heard that as a general rule the higher a person's income, the lower the percentage of it they donate to charity.

If that rule of thumb applies here, then increasing a person's income by reducing their taxes might result in a larger donation to charity, but that donation would represent a smaller percentage (and obviously would not include everything that they weren't would otherwise have been taxed).

[truthspeaker.livejournal.com]

I'm skeptical as well. There isn't any evidence that lowering taxes stimulates the economy to the point where tax revenue increases (though there are instances of raising taxes in a bad economy having revenue go down, but at times when they would have gone down anyway), so I suspect that a similar dynamic applies to charity.

[sharkpoof.livejournal.com]

Because of how the tax law on giving to charity works, i would think that after a certain point of wealthyness (i make well past what i need to live comfortably), it would depend upon a lot of other factors than what the tax rate is.

You can only deduct a certain percentage of your annual gross income and it depends upon what type of asset you donate. for example, someone who donates land to a college can only take 30% of their agi as a deduction and carry over the rest for 5 years.

I guess i think it would be hard to find a correlation between tax rate and donation percentage. tax code and donation percentage is where i could see a likely relationship.