Charity tax breaks for people with less cash aren’t as generous, ProPublica investigation finds.
As tax season concludes, people across the country are looking for all the ways they can lower their tax bill and increase their refund before the April 18 filing deadline.
But for the country’s super-rich — if past years’ tax activity are any clue — tax time likely includes tallying up 2021 charitable stock donations in order to shrink income tax bills to a far greater extent, according to a new report from ProPublica, the investigative news outlet. There’s also no capital gains tax on the donation.
A Bloomberg spokesman declined to comment. In previous ProPublica coverage, Bloomberg representatives have said he “pays the maximum tax rate on all federal, state, local and international taxable income as prescribed by law.” The ProPublica report comes as President Joe Biden is pressing for a new tax that would make households worth at least $100 million pay a 20% minimum tax. Under the proposal, the IRS could count up the value of unsold stock when coming up with the tax bill. The top 400 families are paying just over 8% in income taxes when factoring all their income and wealth, including the value of unsold assets, White House economists have estimated.
Either way, charitable contribution deductions are part of the tax landscape for people who itemize their deductions. And itemizing is not what most taxpayers do. Then they need the portfolio ready to go. Last year, 56% of Americans owned stock through individual company share ownership, mutual funds, a self-directed 401 or IRA, according to Gallup. The people in that group tended to skew richer; 89% of households making over $100,000 said they owned stock, the poll noted.
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