Anonymous
Post 01/07/2018 21:45     Subject: Re:Could DC get around new tax law
Hi question for the tax experts
The article states the following
California lawmakers are considering a tax credit of 100 percent for the proposal — essentially allowing people to replace their tax payments with donations to a state fund. Californians who choose not to make the donation would still be required to pay state taxes.

If required to donate to the fund will it still be considered a donation if you get credits



Anonymous
Post 01/07/2018 14:19     Subject: Could DC get around new tax law
Anonymous wrote:
Anonymous wrote:The big difference between DC and California is DC has to have its laws approved by Congress.


And the IRS can always disallow it as not a bona fide charitable deduction and a scheme to evade taxes. The IRS wold also have to approve the state charities as 501C3'S for this purpose. Wanna' bet on that?


The IRS has to follow the law. Donations to state and local governments are already deductible under current tax law.
Anonymous
Post 01/07/2018 13:53     Subject: Could DC get around new tax law
Anonymous wrote:If it's a donation, then I would choose not to donate.

Frankly, DC does a lousy job with the money I give it, and I'd prefer to put it to better use myself.


I made enough "donations" to DC thanks to its confiscatory, gotcha' parking ticket scheme.
Anonymous
Post 01/07/2018 08:36     Subject: Could DC get around new tax law
Anonymous wrote:The big difference between DC and California is DC has to have its laws approved by Congress.


And the IRS can always disallow it as not a bona fide charitable deduction and a scheme to evade taxes. The IRS wold also have to approve the state charities as 501C3'S for this purpose. Wanna' bet on that?
Anonymous
Post 01/07/2018 04:09     Subject: Re:Could DC get around new tax law
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:California should just reduce their state taxes and rely on voluntary donations. That will go so well...


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.


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.


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.


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.
Anonymous
Post 01/07/2018 03:36     Subject: Could DC get around new tax law
If it's a donation, then I would choose not to donate.

Frankly, DC does a lousy job with the money I give it, and I'd prefer to put it to better use myself.
Anonymous
Post 01/07/2018 01:08     Subject: Re:Could DC get around new tax law
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:California should just reduce their state taxes and rely on voluntary donations. That will go so well...


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.


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.


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.


In eyes of IRS charitable contributions are gifts given without reciprocity, credits are reciprocity.
Anonymous
Post 01/06/2018 23:46     Subject: Could DC get around new tax law
We had an election and, apparently, we voted for to F--- the people/states/industries that did not support the President. Governing by spoils and retribution.

No, I don't think DC would be allowed by Congress to do this.
Anonymous
Post 01/06/2018 23:43     Subject: Re:Could DC get around new tax law
Given that DC can’t operate a functioning tax office as it is, I’m going with no.
Anonymous
Post 01/06/2018 23:40     Subject: Re:Could DC get around new tax law
Anonymous wrote:
Anonymous wrote:
Anonymous wrote:California should just reduce their state taxes and rely on voluntary donations. That will go so well...


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.


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.


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.
Anonymous
Post 01/06/2018 23:37     Subject: Could DC get around new tax law
The big difference between DC and California is DC has to have its laws approved by Congress.
Anonymous
Post 01/06/2018 23:18     Subject: Re:Could DC get around new tax law
Anonymous wrote:
Anonymous wrote:California should just reduce their state taxes and rely on voluntary donations. That will go so well...


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.


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.
Anonymous
Post 01/06/2018 22:29     Subject: Re:Could DC get around new tax law
Anonymous wrote:California should just reduce their state taxes and rely on voluntary donations. That will go so well...


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.
Anonymous
Post 01/06/2018 21:15     Subject: Re:Could DC get around new tax law
California should just reduce their state taxes and rely on voluntary donations. That will go so well...
Anonymous
Post 01/06/2018 20:38     Subject: Could DC get around new tax law
Would DC be able to do something similar to what CA is considering and set up a fund for people to donate instead of paying local taxes and then get the charitable donation federal tax deduction? or would Congress be able to stop them? Would MD or MoCo do this?

https://www.mercurynews.com/2018/01/02/will-california-outmaneuver-a-new-federal-cap-on-tax-deductions/