Hey! It’s great that you’re thinking about how to optimize your donations for taxes (and great that you’re planning to donate so much!)
Some issues I found with your model:
Donating $100k doesn’t give you $32k of tax rebate, because the marginal tax rate isn’t 32% the whole time. From $165k of AGI, the marginal tax rate is 24%; so your total rebate looks more like 35*.32+65*.24 ~= $27k of tax rebate. (You kind of mentioned this in the post but I figured it was good to calculate the impact of, in case it was really high)
It’s worth accounting for the fact that without any donations, you could have taken the standard deduction of $13k, which would be worth 13*.32 ~= $4k rebate already. So your total improvement from yearly donating to a DAF is ~= $23k, not $32k.
Hey! It’s great that you’re thinking about how to optimize your donations for taxes (and great that you’re planning to donate so much!)
Some issues I found with your model:
Donating $100k doesn’t give you $32k of tax rebate, because the marginal tax rate isn’t 32% the whole time. From $165k of AGI, the marginal tax rate is 24%; so your total rebate looks more like 35*.32+65*.24 ~= $27k of tax rebate. (You kind of mentioned this in the post but I figured it was good to calculate the impact of, in case it was really high)
It’s worth accounting for the fact that without any donations, you could have taken the standard deduction of $13k, which would be worth 13*.32 ~= $4k rebate already. So your total improvement from yearly donating to a DAF is ~= $23k, not $32k.
Those both make sense. I’ll try to incorporate them into my spreadsheet in the near future. Thanks for sharing!