You hear a lot about how “the rich” are using charities to effectively reduce their tax to minimal amounts, among other methods.
On the face of it without digging, it obviously makes people angry and detest the rich. But scratching beneath the surface, I’m not quite sure how exactly they would achieve this? In order to claim the tax back from money donated, you still have to… donate money? Which would still equal more than the money claimed back from tax.
So unless they are actually doing something illegal and funneling money through a charity, claiming tax, and then using that money from the charity to fund purchases not related to the charities mission, how exactly is it benefiting the donor (financially)?
In: Economics
Rich person here who gives to charities. I have no idea what’s the norm for other rich people, but I’m not sure I’d trust a lot of Redditors’ theories on what rich people commonly do.
Personally, I give to charities that don’t benefit me whatsoever. It lowers my taxable income, but I’d have more money if I didn’t give at all.
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