Thursday, September 06, 2007

Big Gifts, Tax Breaks and a Debate on Charity - New York Times

Big Gifts, Tax Breaks and a Debate on Charity - New York Times

“A common perception of philanthropy is that one of its central purposes is to alleviate the suffering of society’s least fortunate and therefore promote greater equality, taking some of the burden off government. In exchange, the United States is one of a handful of countries to allow givers a tax deduction. In essence, the public is letting private individuals decide how to allocate money on their behalf.

What qualifies for that tax deduction has broadened over the 90 years since its creation to include everything from university golf teams to puppet theaters — even an organization established after Hurricane Katrina to help practitioners of sadomasochism obtain gear they had lost in the storm.

Roughly three-quarters of charitable gifts of $50 million and more from 2002 through March 31 went to universities, private foundations, hospitals and art museums, according to the Center on Philanthropy at Indiana University.

Of the rest, the Bill and Melinda Gates Foundation accounted for half on the center’s list. That money went primarily to improve the lives of the poor in developing countries. Valuable as that may be, it also meant that the American public effectively underwrote several billion dollars worth of foreign aid by private individuals, even though poll after poll shows Americans are at best ambivalent about using tax dollars in such assistance.

In contrast, few gifts of that size are made to organizations like the Salvation Army, Habitat for Humanity and America’s Second Harvest, whose main goals are to help the poor in this country. Research shows that less than 10 percent of the money Americans give to charity addresses basic human needs, like sheltering the homeless, feeding the hungry and caring for the indigent sick, and that the wealthiest typically devote an even smaller portion of their giving to such causes than everyone else.”

http://www.nytimes.com/2007/09/06/business/06giving.html?ex=1346817600&en=3fbae627fb38813b&ei=5124&partner=permalink&exprod=permalink

con·cept: Big Gifts, Tax Breaks and a Debate on Charity - New York Times