Wednesday, April 16, 2008


That's how much the new governor of New York gave to charity last year, according to his tax return. And it was just $150 worth of stuff donated to the Salvation Army, not cash. Governor David Patterson and his wife had income of $269,815 last year, so that is a tiny fraction of a percent of their earnings. As this New York Times article points out, this doesn't necessarily mean he didn't make any donations, it just means he didn't declare them on his tax return to get the deduction. So if we're going to go all judgmental on him, he's either a miser or he's stupid! (Or, less likely, he has some very noble ideas about voluntarily paying extra taxes.) Here's what a few people had to say about it:

Alitha Martinez, a comic book artist who lives in Manhattan, gave several hundred dollars’ worth of clothing that her 6-year-old son had outgrown to neighborhood charities last year. She also took a $1,000 tax deduction for donating an old Macintosh computer. And she occasionally sells her artwork and gives the proceeds to the Hero Fund, which provides scholarships to children of military personnel....

“That’s the equivalent of, ‘Let them eat cake,’ ” Ms. Martinez said [about Governor Patterson] as she went to mail her own return at the main post office near Pennsylvania Station on Tuesday morning. “That’s not cool.”


Jennifer Fiore, 39, would not say what she does for a living, but she did say she took a deduction on her 2007 return of about $1,000 for donations of clothing that went to benefit breast cancer research, as well as furniture and electronics that were picked up by a group that helps Vietnam veterans.

“It’s almost an insult,” she said of the Patersons’ $150. “It’s not like he doesn’t have enough to give away.”


“It’s up to an individual and someone’s conscience,” said Matthew Kelty, 38, who works at the New School and gave money last year to groups that included the Human Rights Campaign, the Gay Men’s Health Crisis, CARE and Save the Children.

Still, he said, Mr. Paterson’s tax return made him wonder about the new governor’s character.

“It’s interesting that someone who we put our trust in doesn’t seem to care,” he said.

Just hit the "charity" category in the sidebar and you'll see how this same topic has become an issue for me, when some commenters felt I did not donate a large enough percentage of my income. Of course, giving is always a very personal decision: there is no "right" amount to give and people have different reasons for giving or not giving that may or may not seem valid to others. But just to put things in perspective, the Times article had this graphic about average deductions for charitable donations broken down by income range.

I'll save you the trouble of calculating how much the average giving amount is as a percentage of the average income:

$5,000,000 $10,000,000 $297,627 4.0%
$2,000,000 $5,000,000 $115,463 3.3%
$1,500,000 $2,000,000 $62,046 3.5%
$1,000,000 $1,500,000 $41,192 3.3%
$500,000 $1,000,000 $20,858 2.8%
$200,000 $500,000 $8,528 2.4%
$100,000 $200,000 $4,081 2.7%
$75,000 $100,000 $2,945 3.4%
$60,000 $75,000 $2,625 3.9%
$50,000 $60,000 $2,408 4.4%
$40,000 $50,000 $2,207 4.9%
$30,000 $40,000 $2,101 6.0%
$20,000 $30,000 $1,973 7.9%

I didn't find these percentages all that surprising. At the higher end of the income scale, people's basic needs and even luxuries are easily taken care of, so they can afford to donate to charity. At the lower end of the income scale, there is a certain dollar threshold below which people don't want to fall, but of course it is a larger percentage of their income. (Also, maybe they're more tempted to fudge it for the IRS because they desperately need the bigger tax refund.)
Then you have the people in between: Governor Patterson's income range has the lowest percentage for giving. People in these in between levels are the ones who are supposedly "wealthy," or maybe upper-middle-class, or just middle-class in places like New York City where the cost of living is so high. They're anxious about paying for all the expensive things they think they're supposed to have, they're buying homes and having kids and trying to save for retirement: they feel squeezed, and charity is getting squeezed out.
Of course, I should be saying "we," as my adjusted gross income of around $87,000 puts me in the lower range of this group and my charitable giving has so far been even less than these averages. But at least I coughed up more than $150!


MEG said...

There are a LOT of ways to give that aren't tax deductible. Like giving money to individuals in need.

Plus maybe he wanted his donations to be anonymous so he didn't take the deductions he could have (which would make his donations public, since his tax returns are public).

Plus he could have given freely but, like many Americans, failed to property document it and save receipts in order to take the deduction.

BESIDES which he could have donated lots of time and energey, hosted fundraisers, etc all in a giving spirit - you can't deduct your time on your tax returns, but it can be the most valuable thing you can give.

PLUS the man is basically donating his career to be a civil servent. I'm sure he could be making more money in the private sector.

I don't even know anything about the guy, but I know tax returns rarely tell the whole story about anyone.

diggitydiggity said...

i agree totally meg. I usually like your posts and cant fathom why you took this judgemental tone at the same time acknowledging tax returns are not a good indicator.

Raven said...

I'm commenting with a Canadian perspective.

While I donate thousands of dollars in a year, I can't declare any of it on my tax return. The bulk of my donations go to an environmental cause I support but which is not considered a 'charity' by Canadian law. I also have a fund I use to to buy my neighbour pan handlers coffees and hot meals, and to support my local foodbank. None of that is tax deductible, either. Yeah, I could be considered 'stupid' for making donations that don't save me anything on my taxes, but I'd rather support causes that mean something to me and make a real difference in someone's life. Also, when you live in my kind of neighbourhood and you're walking home at midnight, it's nice to know you're under the 'protection' of the local street people so you don't have to worry about getting home in one piece.

Kalieris said...

Thirded. I don't deduct my donations either. Giving is supposed to be without expectation of return.

Asset Gatherer said...

I don't keep track of my donations either. They would probably add up over the year, but each donation is probably around $100 or less. I just don't keep up with it.

asgreen said...

When talking about giving we also forget about time. I don't give that much money, but I volunteer every week. I have to beleive that counts for a lot.

Anonymous said...

What I find interesting is how much higher the precentages are for the lower income categories.

Kady said...

I was only able to take about $1000 in charitable deductions on my 1040. But I also gave over $1000 in charitable gifts (charitable giving in someone else's name - I know this is not really charity b/c it's done in place of present, but you know), and probably another $1000 in microfinance loans, which are not deductible. I also donated A LOT of stuff because we moved into a much smaller space(including a bed, a dining room set, a ton of clothes, an old computer, a TV, two DVD players, a full set of never used pots and plants, a ton of children's stuff, oh yeah, a car) but I didn't take any of that as deduction. (I find the whole act of appraising stuff given to goodwill really smarmy.)

Of course, given my tax bill, I kinda now wish I had.

Janice said...

I'm w/X. I'm appalled that our Governor gave a total of $150 to charity--and that in goods, not cash. But I have to assume that he did actually donate to some causes and left them off his return. I mean really, he didn't support anyone in a walk for breast cancer, or AIDS, or hunger, or MS? It's true that as a civil servant he is already working for the people, but how could he not support a friend or coworker here and there? Or join the NY Botanical Garden, or Bronx Zoo, or WMHT, or WNYC? (or in Albany, WAMC?)
But, on the other hand, what probably is the case is that he made donations to some "vanilla" groups (like those listed above) and some more controversial groups, and instead of putting on some and leaving off others (which would then leave him open to attacks if discovered), he left them all off as a sort of blanket policy.

Liz said...

I read somewhere once that Warren Buffett doesn't donate to charity, because he feels that his money can better be put to use invested now, so an even larger amount can be donated in the future.

Not saying the Governor has Buffett's mindset - or his investing acumen :) But lack of deduction on a tax return may not be the whole story.

Lisa said...

Just adding my voice to the general throng: I don't claim my charitable donations either. In cash, I probably give about $500 altogether, and I have no idea what Goodwill donations would total. It's not worth the tax savings to me, and I figure I can afford it.

Michelle said...

I definitely feel the squeeze like you said. I make 60K a year but in Hawaii that is like being the working poor. We have the highest housing, energy and food costs in the nation and very high local taxes. With my student loans to pay there is really not anything left to give to charity if I want to save something at the end of the month. It sucks because I used to donate $1000/year to a charity that helps homeless kids and it was awful telling them I had to stop. So I try to help charities in non-monetary ways instead...

Anonymous said...

I'm on the board of a local 501c3, but the time and labor I devote to this organization aren't deductible. The IRS allows me to deduct the gasoline costs of going to meetings and events, but keeping track of the mileage is just too much trouble for me, so I don't include it in my tax form.

I'm astounded by how much the chart says people give to charity, especially at the lower income levels. I've never deducted anywhere close to these dollar amounts, which probably makes me look like a real skinflint, but given what I just described above, I think there are ways for people to exercise their philanthropy that don't show up on a tax return.

Andrew Stevens said...

I am going to take some issue with Madame X's comments about the poor. She says, "At the lower end of the income scale, there is a certain dollar threshold below which people don't want to fall, but of course it is a larger percentage of their income. (Also, maybe they're more tempted to fudge it for the IRS because they desperately need the bigger tax refund.)"

The parenthetical comment may very well be true. (Most people making between $20,000-$30,000 do not itemize and these stats are restricted to those who do.) However, I've seen statistics not taken from tax returns which show the same pattern - lower income people give much more as a percentage of their wealth than the middle class.

However, I must object to the comment about "certain dollar threshold." The figure given for the lowest income group is $1973 per year, which is six times what Madame X budgeted for charity in 2007. So if there is a minimum dollar amount, it's apparently very high for some people.

I am not actually criticizing Madame X here. I haven't given as much to charity as I could in my lifetime either.

Ms Broke said...

In Australia our 'goods' donations aren't counted as a $ figure on our returns. So I can donate hundreds of thousands in clothes and whatnot but it won't show on my return. I give about 2% of my income to charity in the form of child sponsorship and donations, but I also volunteer my time and give goods.

Anonymous said...

Warren Buffett has promised the mass of his fortune to the Gates Foundation. He has recently stated he will be giving a large portion of what he has promised before he dies. He can't give more because all of his money is tied up in his company's stock, and if he gives too much he will lose control of his company.

Concerning the high percentages in the lower income brackets, I bet the majority of that is tithing to a church. Which, I wouldn't count as charitable giving.

Also, everyone says how great it is lower income brackets give so much. Why is this good? If they would save that money they might not have to fall back on a charity when something goes bad or we might not have to support them in their retirement.

For those of you who dislike taking a tax deduction for charitable giving, you are essentially wasting money you could be giving to charity. Next time take the tax deduction and give the tax savings away.

AJC @ 7million7years said...

$150 is a pretty dumb amount to list as you can just take the option to claim $500 in Unspecified Non-Cash Donations instead! Then again, who said that politicians HAD to be smart? ;)

Anonymous said...

i'm alarmed at the lack of privacy displayed by the fact that the guy's tax return info can be so easily known and publicized by others. it's called personal finance because it's personal, so why are you dissecting it and judging him by it? sure giving to charity is good and philanthropic and all, but how much philanthropy are you showing your fellow man if you jump on him for simply controlling his own money how he sees fit? this reminds me of a more recent post - the one about peer pressure in spending - now you're the one donating a lot to charity and feeling "jealous" that your "friend" didn't do the same.

Anonymous said...

I don't know, Madame X.

It may be a cultural hang-up, but my parents are fairly wealthy and have never given to charity. Yes, they donate old things to Goodwill on a regular basis, but they have never given actual amounts to organizations. In the same spirit, to my knowledge they've never so much as dropped a quarter in someone's cup.

They both make over six figures now and have been for closing in on twenty years now, but they're Chinese and came to this country with a suitcase full of TOEFL books. For the first seven or eight years in this country, my dad wouldn't even buy a Chinese newspaper (fifty cents in 1980 dollars)...

They got help from no one and in turn offer no help to others.

And even though I grew up here, I feel the same way. I don't believe in charity. If the government feels like some people deserve aid (I'm not saying I disagree with this), the government has far more resources and can make so much more of a difference than the collective hundreds of dollars from its millions of constituents.


stephanie said...

I have donated money to charity every year since I started working at age 15. I have never itemized my taxes because the potential savings from declaring my donations would not be enough to justify either 1. paying someone else to do my taxes or 2. spending the additional time it would take for me to continue to do them myself. I have also donated significant amounts of time and goods throughout the years, and the idea of asking someone to assign a dollar amount to things I donate so that I can write it off for taxes seems ridiculous to me. Also, I believe that a person's money is theirs to do with as they please. If I want to keep every penny I earn, I do not think that there is anything wrong with that, nor do I think anyone should be judged for not giving to charity (or not documenting it) if they choose not to.

On an unrelated note, I also agree with the anonymous comment that perhaps if the lower class stopped donating as much to charity, they wouldn't be forced to rely on charity. I also agree that tithes to churches may or may not truly be "charitable" - usually most of this money goes toward paying for upkeep of the church (electricity, air conditioning, etc.) - arguably mainly benefiting yourself, not the poor/needy (and please note here that I'm not anti-religion, I have given quite a bit of money to churches and religious organizations over the years).

Andrew Stevens said...

Also, everyone says how great it is lower income brackets give so much. Why is this good? If they would save that money they might not have to fall back on a charity when something goes bad or we might not have to support them in their retirement.

I actually agree with this comment. However, it should be noted that the lower income people who give to charity are generally the working poor, who are subsidized by the government in retirement, but rarely fall back on charity. The poor who do frequently rely on charity rarely give to charity.

Susan said...

I don't get it. One, he's in politics and in the public eye. Two, as a public employee, shouldn't he want to give? Or at least pretend like he does? Three, doesn't he want to reap the benefits of tax deductions??

That's really crazy.

Vickifool said...

Since we know about the $150 Salvation Army donation, we know that the governor itemized his deductions. We can safely say that he didn't give any money to any other charities or he would have also deducted those amounts. His accountant would have seen the payees and amounts in his check register or charge statements.

Being a politician does not make up for lack of charity any more than being a teacher does.

Meg opined, "maybe he wanted his donations to be anonymous so he didn't take the deductions he could have." Is he ashamed of the causes he donated to? Are those causes a political liability? That seems very unlikely to me.

I'm always shocked at how much more generous I am than other people.