Holiday giving taxes our generous spirit

COMMENT

December 27, 1998|By Mike Burns

AT THIS time of year, I'd like to reflect on the fundamental concerns of the season: money and taxes.

Come the year's end our eleemosynary instincts prompt us to think seriously about bestowing beneficences on our favorite charities and good causes.

With all the other claims on our pocketbook in this season, this wouldn't seem to be the most practical time to open our hearts and checkbooks, no matter how heart-tugging the charity appeals letter. Credit cards and paychecks exhausted, holiday tensions peaking, winter weather warning us to take shelter from the outside world.

Yet the average American typically contributes a good portion of his annual charitable benefaction in the month of December.

The holidays are, after all, about giving and the lesson of Charles Dickens' "A Christmas Carol" spurs our conscience to make amends for months of indifference to those in need.

But for serious donors, the main reason is the income tax code. Donate before Jan. 1 and you can claim a deduction on your 1998 income tax returns. Donate after Jan. 1 and you'll wait another year to claim it on the 1999 return.

Of course, lots of people do give throughout the year, through charity umbrellas such as United Way or through weekly offerings at church. But this is the season for the once-a-year contributions, the big checks that will gain credit with the Internal Revenue Service.

Generous proof

Checks are prima facie proof for the IRS that legitimate donations have been made within the required time. To be sure, there are tax code rules and limitations, which I won't presume to address here. Suffice it to say that tax collectors warn that proof of philanthropy claimed as a deduction may be required in the event of an audit.

This tax-calendar approach to giving certainly distorts the spirit of benevolence. While organized charities wisely plan their annual budget with an eye to the year-end bulge covering leaner months, the donor loses something important in the calculated transaction. And that is a reflective appreciation of the act of giving itself.

Yes, we should feel generous at this time of year, but also throughout the rest of the year, when human needs do not disappear simply because their relief is not tax advantageous. Giving shouldn't be a matter of a last-minute tax write-off but of a sincere desire to help others whenever we are able.

There are blessed souls who support worthy causes over the course of a year. Many persons freely donate cash or a gift as the need arises; they may buy some food for a hungry family or pay a needy child's dental bill. That is the unstrained quality of charity, given when able and when needed, without regard to an accountant's advice.

These free givers are presumably on shakier ground with the tax service than the calculating year-end check writer. They likely don't have the receipts and verification letters to back up their deductions. While it's not clear that the IRS targets that kind of donor for examination, if the claims are within reason, it's true that the tax laws tend to intimidate persons who don't have hard evidence of their generosity.

Anonymous gifts

How many of us are asked by various causes to contribute a few dollars cash, a toy or clothing, for the less fortunate without getting a receipt? How many are moved to drop a donation into the Christmas kettles and store-counter collection boxes? How many respond with free-will offerings at holiday observances? The moral value is greater than the legal value, as it so often is in our society.

I don't mean to be petty about it, thus demonstrating the type of cynical behavior I deplored in previous paragraphs. But these things can add up.

One of my children was asked for donations to four different holiday projects this month: elementary school, Girl Scouts, Sunday school, neighborhood playmates. Several weeks earlier, the public school "asked" us for both food and money to support its Thanksgiving project; donor children's names were written down on a classroom list. Multiply all of that by several children and pretty soon you're in the United Way category.

Most of this was given in currency; but even checks were made out to the school or to the organization. In one case, the officious "room mother" demanded a lump sum payment to cover the charitable project, a Christmas gift for the teacher, the school year-end gift for the same teacher, and a class T-shirt. Try splitting that up for tax purposes.

The public schools know better. That's why the room mothers have taken over the job of squeezing parents to give for an unknown and unconfirmed recipient. It's not the money, but the principle for many of us. For others, it is a matter of money and how limited resources must be used.

This kind of impressed solicitation does not belong in public schools. Not because it doesn't provide a tax receipt, but because it is giving that does not come from a willing heart.

Mike Burns is The Sun's editorial writer in Carroll County.

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