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[quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous][quote=Anonymous]California should just reduce their state taxes and rely on voluntary donations. That will go so well...[/quote]

The point is not to ask for voluntary donations and hope people pay up, it is to set up a charity and then for every dollar a person in CA donates, her state/local tax liability goes down by $1. Donations to this new charity would still be tax deductible under federal law  for those who itemize under the new law.[/quote]

Hypocrisy at its best. Though, how would it work anyway as one has to reduce the donation amount by what one gets back as a benefit. Reduced tax liability to California is a benefit that will be reducing the donation. [/quote]

California is a sovereign, it can set its own tax policy. It's policy can be that donations to the state qualify for a credit, not a deduction, on state taxes. Until the Congress changes federal law that's still a deduction at the federal level. And this Congress isn't going to be doing much of anything this year.

And why is it hypocrisy? The states set their tax policy independent of the federal government. The states can reset the relationship from their end back to the way it's been since the beginning of the income tax. [/quote]

The state of Maryland has a community investment tax credit.  If you make a donation to a qualified nonprofit, you also receive a tax credit worth half the amount of the donation.  You still get to claim the donation as a charitable deduction.

In eyes of IRS charitable contributions are gifts given without reciprocity, credits are reciprocity. [/quote][/quote]

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