Your calculator is honestly pretty depressing. You don’t really get any tax benefits unless you are wealthy enough to donate large sums in the ~$20,000 to $100,000 range.
Imagine the median American, about $50K income, takes the 10% rule in an act of extreme generosity and donates $5000.
His tax reduction is $241, a 3% reduction. Pretty insignificant.
At my income level of only around $100K, the optimal donation strategy would be to hold onto your money until you can eventually save to about $60K, then donate it all in a single tax year. The fact that US tax law demands you play these idiotic games makes me roll my eyes.
Yes, we’d like to add multi-year capabilities to the model at some point. Bunching can provide significant savings especially for middle-income households; however, if you’re donating appreciated assets (generally more bang for the buck), you can only deduct 30% of AGI, rather than 60% if cash.
Your calculator is honestly pretty depressing. You don’t really get any tax benefits unless you are wealthy enough to donate large sums in the ~$20,000 to $100,000 range.
Imagine the median American, about $50K income, takes the 10% rule in an act of extreme generosity and donates $5000.
His tax reduction is $241, a 3% reduction. Pretty insignificant.
At my income level of only around $100K, the optimal donation strategy would be to hold onto your money until you can eventually save to about $60K, then donate it all in a single tax year. The fact that US tax law demands you play these idiotic games makes me roll my eyes.
Yes, we’d like to add multi-year capabilities to the model at some point. Bunching can provide significant savings especially for middle-income households; however, if you’re donating appreciated assets (generally more bang for the buck), you can only deduct 30% of AGI, rather than 60% if cash.