Pukes Closes Major Tax Loophole for Middle Class (charitable donations)

[democraticinsurgent]

NEW RULES
Don’t donate junk, expect income-tax deduction
Saturday, August 19, 2006
Mary Dalrymple
ASSOCIATED PRESS

Any household item with little value likely won’t qualify for a deduction under new tax rules for charitable giving and receiving.

The Internal Revenue Service may deny deductions for donations of clothing or household items — furniture, appliances, linens, electronics and similar items — that aren’t in "good" condition.

"What is the definition of good and better?" asked Maj. Todd Hawks, national public affairs secretary for the Salvation Army.

The new rules, which became law Thursday when President Bush signed a massive pension bill, ask the Treasury Department and IRS to define those terms.

http://dispatch.com/national-story.php?story=dispatch/2006/08/19/20060819-A1-00.html

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My comments: on the face, not a terrible thing; no one should get tax deductions for donating junk. However, this is one of the few areas where lower to middle class Americans can actually get a tax deduction. Proving an item to be in good working order isn't easy or even possible many times. Plus, lots of thrift shoppers are thrilled to find old electronics and other items that aren't perfect if they know how to fix them up. Thrift stores are all about "one man's trash is another man's treasure".

Just seems like another slap in the face to working America in a series of many many slaps.

[Lerkfish]

1. this may impact Goodwill Industries

who rely on "junk" being donated to be refurbished and resold.

won't change MY giving, but it might enough people who will just throw things away rather than schlep to the goodwill dropoff.

[angstlessk]

2. And how EXACTLY is the IRS going to determine good vs junk?

Will they now have a arm of the IRS who inspects donations? How VERY STUPID...it is just a way to say NO unless you are a super rich taxpayer, of course their stuff is ALWAYS good, whereas the little guy only gives junk. A bunch of hooey!

[gratuitous]

3. Another volley in class warfare

This is an elitist, classist definition of value based on the consumerist definition of "value." I had a friend who spent some time in India. She brought back a stringed gizmo for another friend that had been cobbled together out of "junk." The strings were wires of varying gauges and thicknesses, the stops were carefully trimmed pieces of sheet metal, and keys cannibalized from a manual typewriter had been mounted on tabs on the stops. By plucking or picking the wires and holding down the stops, you could produce notes of varying pitch. A little tuning, and you had a serviceable musical instrument. Made from less than five bucks' worth of cast-off junk. And you'd never, ever see it in the home of an IRS agent or a congress critter. Which would be their loss.

[Occulus]

6. Neat story. Can you get a picture of it?

I would really like to see what this thing looked like. Your description sounds almost like what a dulcimer looks like, or perhaps an autoharp...?

[gratuitous]

27. My friends are in Africa right now . . .

But yes, it was a sort of cross between a dulcimer and an autoharp.

[formercia]

4. This way jerks can't demand a deduction

If the charitable organization doesn't feel the item was usable or salable, they shouldn't have to accept the donation and supply documentation. I've seen many cases where obsolete computer equipment was donated and documentation expected. That $5000. server is now junk..period.

[Dr.Phool]

5. It's a lot easier for me to cary "junk" to the curb. And I do.

Stuff that's still good or useful to someone, I cart down to Goodwill.

[MissWaverly]

11. they're going to hassle the thrift industries

so that you will never get a receipt, nothing will be considered "eligible" Meanwhile, it's
time they voted for another tax cut for the wealthy elite, oh, I forgot, they are on vacation,
not to be confused with their working vacation. Oh, well, put it on the list of things to do.

[slaveplanet]

20. Have you noticed

the incredible increase in the amount of people driving by the curb and going through the trash over the past several years. I see lots of beat up vans and trucks patrolling every trash morning. There's certainly some kind of incentive involved for the increase. I'd say Ebay and the rise in scrap metal prices are the likely culprits, but I'm not discounting starvation and gas money.

[SoCalDem]

7. Most organizations give you a BLANK donation form

they just want the stuff.. I'm sure they cull out the crap, but they do not have the manpower to manually go through the stuff as people donate it, and give it a "grade".

If people are careful with their total donation amounts, they will not trigger an audit, and who's to say ...a year later..after the stuff is long gone, just what condition those toys were in..

What they are really going after is the car donation to charity.. People were "dumping" old cars and then claiming blue book on them..

If you get greedy and claim to donate thousands of dollars worth of stuff and your income does not warrant it, then you may get caught..

[davsand]

8. If you need you will see "value" in a donation.

Seems to me that if you actually "need" a pair of shoes or a bed you will find value in just about anything you can get. The "value" concept speaks volumes about the lawmakers who passed that law--they obviously have never been without.

As long as we keep electing millionaires and PAC-Whores this is the kind of legislation we'll see. These guys have about as much in common with the real world as Marie Antoinette did.



Laura

[Tyo]

9. One more little hit

This is totally in line with the NeoCon view that the middle class is a threat and has be be destroyed. This rule in itself isn't going to make much difference in my tax return but it's one more example of the death by a thousand cuts that the right wing is inflicting on us. They've got the poor pretty much where they want them. Now they are trying to increase their numbers.

[area51]

12. Welcome to DU, Tyo. (n/t)

[democraticinsurgent]

15. funny i was going to use that phrase in my post

death by 1000 cuts. it sure is, isn't it?

i am an avid thrifter and have definitely bought stuff at thrift stores that had no "value" by many people's standards. especially the greedy neocons.

[Toots]

10. One step closer to "Flat Tax"

:shrug: Republicans are quite regressive aren't they?

[Neecy]

13. Surprising

Most of the thrift stores are run by religious organizations - Salvation Army, Catholic Charities, etc. This is sure to stir up 'the base'.

What a shame. There are several smaller thrifts around here run by religious groups that help feed the homeless and disabled veterans. It's not just the little guy getting screwed here, it's the people most desparately in need in our society. Repigs don't care.

[democraticinsurgent]

16. excellent point

i'm pretty sure a lot of the "substandard" clothing gets passed on to homeless shelters by thrifts who don't think they can sell it...

[slaveplanet]

22. I saw a story where most of the donated clothes

are sold to west Africa by the ton, they then end up in shanty street boutiques, which sometimes get bulldozed by with all their inventory by the local thug government for not paying taxes or if the thug wants the streetcorner back.

[alfredo]

14. Cutting deductions for charitable giving started during

Saint Ronny's presidency. He urged people to give to charities and rely less on government programs, then cut the charitable giving tax deduction by half.

[Gormy Cuss]

17. There's a worse change

"Another new rule requires that taxpayers who deduct cash donations have a receipt or bank record, such as a canceled check, to prove the gift. Instead of placing a few dollars in the collection plate, donors might want to write a check."

Combine that with the new standard of proving that household goods meet some nebulous definition of "good condition" and the little people won't be able to get write off their donations.

[cascadiance]

18. This will also increase the amount of trash in landfills too!

If standards are made to discourage re-use of goods and reduce their life span of usefulness, that means more of them will wind up on landfills and of course corporations will love having to build more crap to replace them that people will buy new instead of reusing old stuff. Not only bad for us looking to get tax deductions, but an added cost to society and the environment that will suffer and become more costly to maintain.

[TahitiNut]

19. Funny how they don't close the business 'expense' loopholes.

Posh hotels in Hawaii? Business. First class travel for family? Business. Season tickets? Business. Gas the car on the company account? Business.

:puke:

[OzarkDem]

21. This is blatant punishment for middle class taxpayers

They're not even trying to hide it anymore. The drive to shift the burden of all government funding to middle and lower class taxpayers is out in the open. How petty and vindictive can you get, especially when we read every day of a new law to cut taxes for the wealthy.

[KansDem]

23. Is this the $400 tax deduction ?

Up to $400 doesn't require paperwork; anything over $400 requires documentation...?

My wife and I give away a lot of stuff during the year: children's clothes, bicycles, coats, sporting equipment, dress-up clothes, household items, encyclopedias...etc. Our children are constantly outgrowing their clothes and we found the used-clothing stores either don't want our stuff (not "cool" enough) or offer so-low-a-price as to make the whole process not worth our time (sort out clothes, wash, dry and fold clothes, box up clothes, drive to stores--and have only one or two items accepted). So we give a lot of it away and take the deduction.

Don't know what we're going to do if this passes. Probably the same thing--just won't be able to deduct anything.

[sandnsea]

26. If you have time

Have a yard sale with those clothes and sell it for a dime an item. You will help a whole lot more folks that way than donating it to some place that sells stuff for almost the price it costs to buy it new. At least that's the way it is at our thrift stores these days, so disgusting I refuse to even go in them anymore. It used to be the inexpensive items provided the help - now they charge more and then tell you it's "going to a good cause". Well what are the actual poor people supposed to buy??

[sandnsea]

24. And right in this thread

People bend over willingly. There's limits on charitable giving as it is, I think you have to itemize to claim the deduction these days. I don't remember that separate charitable line on my tax form that used to be there. But what the hey, just let 'em fuck us and fuck us and fuck us - and let Mama Bush have her little charity loophole that supports Neil's education company. God we're stupid.

[otohara]

25. This Sucks

I'm constantly giving stuff away to various charities.