Do people donate to churches because the donation is tax exempt?
This question inspires this one.
If churches were to lose their tax exemption status, then tithing to the church would no longer be a charitable deduction for individuals. Would this negatively affect the bottom line for churches? Would you continue to financially to their church if you were no longer able to write it off on your taxes? Would you contribute at the same level? Would it affect your involvement with a church?
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10 Answers
If church donations were not tax exempt, donations would fall off significantly. However, it is possible to tax churches for their land and other profits, yet still allow donations to be tax exempt by forming a non-profit, charitable organization and filing a 50lc
I highly doubt people would stop donating if it was taxed, I think it’s done out of loyalty and a sense of community for the most part. As well as some donating out of a sense of obligation or peer pressure.
Some people probably do donate just because of the tax thing, but for the most part I suspect its down to other factors.
The 10% who give 90% of the Church budget would probably still give. It’s a matter of faith, and the tax deduction is just bonus.
I support my church to support it’s work. for many people, their contributions to their church is not enough to qualify for itemizing their deductions.
I think there would be an effect – but probably not a big one at all.
If I went to church and made donations out of my own heart, I’d keep doing them either way, yes.
Unfortunately though, I give my donations to random homeless dudes out in the street lol.
There is two things that apply if I donate to the church. My donation gives me a tax break, and the church does not pay taxes on the money. I think people who are very religious and give a portion of their income automatically, like 10%, would keep right on donating in the same way, even if tax laws changed. Same with people donating to televangelists. In fact, people who regularly attend church, middle class and poor, I would think donations would continue at the same pace. However fairly large donations, done by people who have a better understanding of the tax law, and don’t attend regularly, might cut back, and donate their money to a different place. But, if the church was running a program that could receive tax exempt status on its own, that might be a loophole around the matter in regards to church run youth groups, educational programs, etc.
I believe that people donate to churches because they believe in the chirch’s mission, and that tax exemption has little to do with it.
Our family tithes anywhere from ten to fifteen percent of our income. We don’t use the tax deduction available to us because that isn’t the reason we tithe, not saying that it is wrong for others to use their deduction just not our choice. So the change in the status for the churches wouldn’t affect our actions.
I think that many people would not change their actions due to a change in the tax laws. Just my opinion though.
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