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Actually, you should give the credit to his salespeople. Evil, evil salespeople.
By the way, the money people like Gates donates to charity? Comes off their TAXABLE income, so they have LESS to pay in taxes.
So let me get this straight... if my marginal tax rate is 35% and I donate $1000, and I reduce my tax burden by $350, the reason that I spent $1000 was to save $350 on taxes?
So let me get this straight... if my marginal tax rate is 35% and I donate $1000, and I reduce my tax burden by $350, the reason that I spent $1000 was to save $350 on taxes?
No...your TAXABLE income comes down by a 1000, which might drop you into another bracket...meaning you pay a smaller dollar amount of taxes.
No...your TAXABLE income comes down by a 1000, which might drop you into another bracket...meaning you pay a smaller dollar amount of taxes.
you are taxed less on 39,000 than on 40,000.
*ahhem* ... so as I said.. if my marginal tax bracket was 35% and I donated $1000, my tax burden would be reduced by $350 ($1000 *.35). So I would have spent $1000 to save $350.
Now you're right that it could adjust my tax bracket... but that would make my savings that much less desirable. You do realize that a marginal tax bracket isn't your effective tax, right? So by me bringing down my taxable income to a 33% bracket, I don't actually save any money, right?
People don't donate gobs of cash to charities to save money on taxes. They buy artwork for $10k, get it appraised at $75k, and write off the $75k. But that doesn't work for Mr Gates and his foundation.... he's not donating money to save on taxes.
*ahhem* ... so as I said.. if my marginal tax bracket was 35% and I donated $1000, my tax burden would be reduced by $350 ($1000 *.35). So I would have spent $1000 to save $350.
Now you're right that it could adjust my tax bracket... but that would make my savings that much less desirable. You do realize that a marginal tax bracket isn't your effective tax, right? So by me bringing down my taxable income to a 33% bracket, I don't actually save any money, right?
People don't donate gobs of cash to charities to save money on taxes. They buy artwork for $10k, get it appraised at $75k, and write off the $75k. But that doesn't work for Mr Gates and his foundation.... he's not donating money to save on taxes.
Actually, from your example, you would save MORE than $350 by lowering your bracket.
Actually, you should give the credit to his salespeople. Evil, evil salespeople.
By the way, the money people like Gates donates to charity? Comes off their TAXABLE income, so they have LESS to pay in taxes.
The salespeople don't have to do much work when the product is great. Look at Vista, a horrible product, the salespeople still can't sell it to people. Microsoft is already working on the next OS. Credit to salespeople? Only if they can sell crap and make lots of money doing it. I won't give them credit when a good product is sold.
They don't pay "less" taxes. They pay the same taxes except some of that tax money is going to charities and bypassing the government's hands. There are also limits on how much you can give and what you can claim. It doesn't matter anyhow since "most" people give to charities not because they want to pay "less" taxes, but give because it is within their value system. Accordingly, the most "generous" happen to NOT be wealthy and more commonly seen among conservative voters (NOT liberals) perhaps from religion and not tax deductions.
The salespeople don't have to do much work when the product is great. Look at Vista, a horrible product, the salespeople still can't sell it to people. Microsoft is already working on the next OS. Credit to salespeople? Only if they can sell crap and make lots of money doing it. I won't give them credit when a good product is sold.
They don't pay "less" taxes. They pay the same taxes except some of that tax money is going to charities and bypassing the government's hands. There are also limits on how much you can give and what you can claim. It doesn't matter anyhow since "most" people give to charities not because they want to pay "less" taxes, but give because it is within their value system. Accordingly, the most "generous" happen to NOT be wealthy and more commonly seen among conservative voters (NOT liberals) perhaps from religion and not tax deductions.
How do you know they weren't selling crap, if they weren't giving alternatives to the purchasers? They were actually saying they would not support retailers who offered alternative OS's.
Charitable deductions come OFF your taxable income. That much is fact. I have prepared taxes for four years, and I know how true this is. I am also aware that some people that don't have a lot to begin with give money away.
Actually, from your example, you would save MORE than $350 by lowering your bracket.
No... you wouldn't, it's simple math. Assume a single person with no deductions:
160,850 - 349,700 - $39,148.75 + 33% amount over 160,850
349,700 - no limit - $101,469.25 + 35% amount over 349,700
Assume the person made $350k.
$101,574.25 taxes owed with no charitable contribution
$101,238.25 taxes owed with charitable contribution
Tax savings: $336
Now assume the person made $351k.
$101,924.25 taxes owed with no charitable contribution
$101,574.25 taxes owed with charitable contribution.
Tax savings: $350
So back to my question... why would someone donate $1000 to charity to save money on their taxes?
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