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We're barely hanging on here.
(media.kbin.earth)
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this post was submitted on 07 Jun 2024
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Has anyone properly investigated these buttons.
Part of me wonders if it's just giving them $20 off their taxes.
Edit: Assuming they follow the law, they don’t use your point of sale donations according to this article
https://www.taxpolicycenter.org/taxvox/who-gets-tax-benefit-those-checkout-donations-0
Half errant OG statement: It’s absolutely a tax write off for them. It’s a double bonus for them because they can choose which charity it goes too as well.
What happens to the money you donate at the cash register?
This is where you round up your bill to give to a charity designated by the retailer, and the donation amount appears on your receipt. The store serves only as a collection agent for your gift. Assuming the business is following the law, it will not include your donation as part of its business receipts, or income, nor will it claim the charitable gift as an expense.
In other words, your gift has zero impact on the store’s income taxes. Keep in mind that the store chooses the receiving charity, so make sure it is one you can support. As a customer, the donation will appear on your receipt and you can claim it as a charitable deduction when you file your income tax return. But you probably won’t.
Considering the amount of wage theft that goes on, I never assume that.
I wonder if the credit card processor takes their percentage of the transaction and then kicks some of that back to the retailer for donations. It seems like that would end up being a tiny amount of money, though.
It absolutely isn't.
I did your work for you
You might think so, but the stores don't get to write it off.
They may not get to write it off, but they do get to benefit from the PR of bragging about how much they donate to charity, and they can also handpick the charity, many of which are just fronts for corporations to greenwash/whitewash their activities.
They certainly don't do that sort of thing out of the goodness of their heart.
And? The charity gets its cause in front of millions of people.
A mutually beneficial arrangement isn't a bad thing. This is basically just paying for advertising, which every charity ever does.
Actually she recently posted a video about it: https://youtu.be/NK383aei0ao
I think you're being given an incomplete picture here. It is a tax write off but it's balanced out by the money they collect. So if they collect 100K in donations, they report that as "income" but it's immediately written off as a charitable donation. Thus, they don't directly get anything out of it as it's functionally a net-zero transaction as far as their taxes are concerned. In fact, it probably ends up costing them a bit once you account for the hours spent by some admin or marketing team getting the program set up and administered.
Obviously they are getting something out of it: As others here have said, they get to brag about all the money they collected for charity. It's possible these big corps also have some convoluted accounting practices that make this further advantageous but on the face of things that's not how it works.
They do not record it as income, nor do they write it off on taxes. Those are your donations, they are merely a collector. You can claim those donations on your own taxes.
I suppose you may indeed be correct. I always assumed not as it's not like they give you a donation receipt like when you directly donate to a charity. Now that I think of it, however, the donation itself would be itemized on the receipt and could therefore be used as proof in a personal audit. I just never really considered it as I just donate like 2 bucks here or there via this means.
I suppose this also might vary in different jurisdictions.
End of story, I'm willing to admit that I may have been misinformed (AKA wrong) myself.
You do get a donation receipt from them. If it's not a separate receipt, then it will be on your purchase receipt.
In my experience I've never received a separate receipt just for the donation portion (again, could just be a regional thing). But as we both mentioned, it'd at least be listed on the purchase receipt itself and could be used as such.
It happens, and is somewhat common. So in what way is the practice a benefit for the corp? I doubt it is just bragging rights?
It largely is bragging rights, actually. Good PR is very valuable to a corp. And if the corp is running the charity it is also collecting donations to, then that's double the good PR. For example, if they're collecting donations for a charity that helps kids get involved in the arts, and they themselves run the charity, they can both say they raised a ton of money for charity and show the good work their charity has done.
This is good stuff, I want to stress. Charities are rarely for bad causes, though of course that can be slightly subjective and I encourage people to only support causes they believe in. But charity is being done, and the corp is not getting a tax write off, but rather good PR.
Virtue signaling is the purpose. It convinces some people that they care. They don't need to care, they just want to look like they do.
Donations reduce tax liability. They are donating your money in the name so yes, that's exactly why they do this. Plus they get to say, "we donated xxxxxx to end give this year!"
Every time an employee asks me If I want to round up, I tell them no, their company can handle their own tax liability.
(I could be wrong but I don't fucking know and they have enough to donate I don't)
This isn't true. The stores don't get tax benefits from your donation.
Thank you for combating misinformation. I appreciate knowing the facts.
This is one of those things where even though the truth is important, the fact that people thought this is what was happening is a sign of a poor relationship. It's like if a person thinks their partner cheated when they went to Las Vegas. Even if the partner did not cheat, the person believing that it was not only possible but likely is a sign that the relationship is toxic. The implication is that the partner is not in the relationship voluntarily or for the mutual benefit of both. Rather, the relationship has become antagonized and transactional. The partners are not helping each other grow. They are in a relationship in which taking advantage of the other is expected because it has happened multiple times already.
Having a reason for seeing everything in a negative light doesn't make it a healthy way to view the world.
At least verify your assumptions before sharing them.
Good to know. Still not giving them my money when my "round up" is a rounding error for them I'm sure.
Assuming they’ve selected a good organization to donate to, that’s a shame - especially for local charities that really benefit from the money.
The whole point is that it’s a “rounding error” for the customer, but it adds up. If you round up 50 cents for 50 grocery trips a year, that’s only $25. If 2,000 other customers do it, that’s a $50,000 donation from just one store.
I don’t donate directly to anything, unfortunately, so if I see a good cause like St. Jude or a local charity at checkout, sure I’ll round up.
I think there's a bit of a difference paying cash vs. card
with cash, rounding errors basically mean, "this money will go to a cause rather than get lost in my couch cushions." With a card, the rounding errors add up
for the charity, yes, but also for the customer.
I think another point is, why isn't the large corporation using their rounding errors instead of mine?
But to each their own of course.
They do make their own donations, separately, often. Customers’ donations are just another way.
I guess think of it from the charity’s perspective. Checkout donations are steady fundraising for them that supplements their other more sporadic and difficult fundraising attempts. I imagine they solicit the stores to do this for them when they’re not organizing 5Ks and hosting dinners for rich people.
If it’s upsetting that stores get to promote themselves for doing it, then just donate directly. Same difference.
I don't see why this is a bad thing? It's a mutually beneficial arrangement. The store gets brownie points and the charity gets their cause in front of more people.
If you donate through these buttons and keep your receipts, you can write it off on your own taxes.
I’ve never seen a $20 button - usually they round up to the nearest dollar or have $1-3 suggestions. Not worth the trouble to keep track for most normal taxpayers.