How the Rich Reap Huge Tax Breaks From Private Nonprofits • Hacker News Board

Re: How the Rich Reap Huge Tax Breaks From Private Nonprofits

#221

Post by WarOnPrivacy » Sun, Jul 30, 2023, 5:43 PM UTC

PaulDavisThe1st wrote: post #206

WarOnPrivacy wrote: post #189

Earlier quoted context omitted.

> The reality is that all human organizations - government, for-profit, not-for-profit - suffer from incompetence, corruption and inefficiency. My observation is that size matters. Generally speaking: The larger an entity is, the more difficult it becomes to be a benefit to the public. The ability to cause harm doesn't diminish the same way (if at all). Governments and NGOs at least have a realized duty to be a publi…

Well, to a point, you may be right. However, there many very large organizations that generally do better than the majority, so I don't think it's a linear or even necessarily causal relationship. Size certainly makes incompetence, inefficiency and corruption easier, and harder to eliminate. There's also the problem of balance: several UN organizations, for example, do immense good with remarkably limited resources b…

>There's also the problem of balance: several UN organizations, for example, do immense good with remarkably limited resources but occasionally they or their cousins frak up really badly and cause severe harm.

The thing about groups, Zero Want To Clean Their Own House. I mean every bunch of people you can draw a line around. Every group, entity, org, corp, gov, club, lodge, council, society... Poor souls who try to fix things from the inside get quick evidence.

It may be the most universal human failing I know of. And maybe the least discussed.

Re: How the Rich Reap Huge Tax Breaks From Private Nonprofits

#222

Post by tacticalturtle » Sun, Jul 30, 2023, 5:46 PM UTC

AlbertCory wrote: post #207

seattle_spring wrote: post #202

Earlier quoted context omitted.

Do you expect qualified people to work for these charities for free? 100k is not a lot in SF, and it's very likely the people in those roles could make multiples more at private organizations.

1) how do you know they're "qualified"? Which leads to... 2) the Civil Service has rigorous rules on fair, non-discriminatory hiring. Do these orgs? 3) I don't know how you could know "it's very likely the people in those roles could make multiples more at private organizations." For all we know, they're people who've never had a private sector job in their lives. 4) Why can't the SF civil service do these functions?…

Couple points I thought of:

“how do you know they're "qualified"?”

Interviews? Resumes? References? Same as any job in the market today?

“I don't know how you could know "it's very likely the people in those roles could make multiples more at private organizations.”

They’re providing free legal services to the homeless. I’m assuming they’ve hired lawyers.

Looks like average total pay for a lawyer is 150k in SF?

https://www.glassdoor.com/Salaries/san-francisco-attorney-sa...

“ What incentive do these orgs have to actually solve the problem, when their very existence depends on it continuing?”

You could ask this of any charity. What incentive does St. Jude have to cure childhood cancer? At some level, you just have to trust that the people involved in these organizations have altruistic motivations as a guiding principle. If you don’t trust them, you don’t have to give them your money.

Re: How the Rich Reap Huge Tax Breaks From Private Nonprofits

#223

Post by AlbertCory » Sun, Jul 30, 2023, 6:02 PM UTC

tacticalturtle wrote: post #222

AlbertCory wrote: post #207

Earlier quoted context omitted.

1) how do you know they're "qualified"? Which leads to... 2) the Civil Service has rigorous rules on fair, non-discriminatory hiring. Do these orgs? 3) I don't know how you could know "it's very likely the people in those roles could make multiples more at private organizations." For all we know, they're people who've never had a private sector job in their lives. 4) Why can't the SF civil service do these functions?…

Couple points I thought of: “how do you know they're "qualified"?” Interviews? Resumes? References? Same as any job in the market today? “I don't know how you could know "it's very likely the people in those roles could make multiples more at private organizations.” They’re providing free legal services to the homeless. I’m assuming they’ve hired lawyers. Looks like average total pay for a lawyer is 150k in SF? https…

I've done my research here. Now it's your turn. These people's names are all on the Charity Navigator pages I referenced. Try them on LinkedIn & other online sites.

Tell us what their qualifications are, what other jobs they've held, and where they live.

For bonus points: what political causes do they contribute to? Civil Service laws prohibit forcing employees to make political contributions, but those laws don't apply to employees of these orgs, AFAIK.

> If you don’t trust them, you don’t have to give them your money

I don't, but the City still does.

Re: How the Rich Reap Huge Tax Breaks From Private Nonprofits

#224

Post by 6ak74rfy » Sun, Jul 30, 2023, 6:48 PM UTC

habosa wrote: post #169

If you live in the US and like to donate to charity you can have your own private foundation and you don’t have to be a jerk about it! It can be a convenient way for you to do good in the world. It’s called a Donor Advised Fund and you can donate large sums to it and then direct the money in pieces to charities you support over time. In between the money gets to grow if you choose to invest it, and you get the tax wr…

True. Don’t know about Daffy but I’ve looked at Fidelity Charitable which does something very similar. “Donate” now, save taxes now, distribute the money when you want but let it grow (however you want) until then.

Re: How the Rich Reap Huge Tax Breaks From Private Nonprofits

#225

Post by mihaic » Sun, Jul 30, 2023, 6:52 PM UTC

wskinner wrote: post #212

mihaic wrote: post #199

Honestly, why isn't there a general indignation against the concept of tax breaks for any charitable contribution? I'm generally not aligned with the libertarians, but let's just lower taxes and simply let people give wherever they want. The only real benefits that non-profit structures like a 501(c) should be that their donations aren't taxed as income, and that's it.

In America, there is broad implicit approval for the idea that the tax code should be used to encourage (discourage) desirable (undesirable) behavior. We may quibble about the definition of desirability, but most Americans do seem to support this.

It doesn't seem to be working though when breaks are given so broadly.

Re: How the Rich Reap Huge Tax Breaks From Private Nonprofits

#226

Post by steveBK123 » Sun, Jul 30, 2023, 6:57 PM UTC

seattle_spring wrote: post #203

steveBK123 wrote: post #121

I visited a park/reserve that definitely walked the line on this stuff. On the one hand it was open to the public 5 days/week, most of the year, provided you purchased!! generally-available tickets in advance. On the other hand after a few visits I learned that the giant mansion at the center of the park was still occupied by the textile baron owner who set up the foundation. This foundation was setup almost as soon…

Are you by chance talking about the Bloedel Reserve on Bainbridge Island?

Nope Longhouse reserve

Glad to hear this is a common scam lol

Re: How the Rich Reap Huge Tax Breaks From Private Nonprofits

#227

Post by zo1 » Sun, Jul 30, 2023, 7:07 PM UTC

boucher wrote: post #190

zo1 wrote: post #52

Earlier quoted context omitted.

What about sales tax, VAT, fuel levies, consumption taxes, gift taxes, inheritance taxes, etc. Your state or country may not have all of the above. But they are all there to tax you to ridiculous amounts but not at the "start". Same goes for withholding or "Pay as you earn" taxes which serve to not let you see how much taxes you are paying. No one will be happy if more than half their labour is taken from then. We ca…

Good one. People making half a million dollars every year are just a few steps away from slavery because they're paying 50% in taxes.

In my context, I live in a different country. Here the real middle-class is taxed way more strictly than in America, due to the high level of inequality skewing the stats.

I'm no where near "well off" or "wealthy", but comfortable middle-class here, and I'm already at the 41% bracket on income only. Effective tax-rate I'm sitting somewhere around 35%, probably higher. And that extra 15% to get us to 50% is easy to arrive to if I take in to account all the various VAT, import taxes, sin taxes, property taxes, etc that are extracted from me by government. E.g. 2% of all my income goes to tax on my modest home, poof.

And that's not even taking in to account all the "public" services I should be getting according to that "social contract" but instead paying the private sector for because they don't exist. Lovely things like fire, health, road maintenance, security, schooling, ambulance services, unemployment, social security for retirement, and who knows what else at this point.

But sure, discard my overall point by making it seem like I said rich people are slaves.

Re: How the Rich Reap Huge Tax Breaks From Private Nonprofits

#228

Post by gumby » Sun, Jul 30, 2023, 8:05 PM UTC

Why is there even the concept of a "nonprofit", with tax deductible donations? This has never made any sense to me.

Re: How the Rich Reap Huge Tax Breaks From Private Nonprofits

#229

Post by stephenhuey » Sun, Jul 30, 2023, 8:35 PM UTC

gruez wrote: post #135

avidiax wrote: post #84

Earlier quoted context omitted.

What do you want to do as a rich person? * Own and enjoy fantastic properties: - You own so many properties that you'll spend maybe a few weeks per year in each one - So donate these properties to your own charitable foundation, give tours while you aren't there. * Have lavish parties - Call it a charity ball, hold an auction at some point, now you look great and the canapés are tax-free. * Fly private - Book a meeti…

>- Give them sweet jobs in your foundation. Pay them competitive salaries without going through a competitive candidate search. Continue this even after you die, essentially a tax-free annuity. It's not "tax free" when those salaries are taxed just like any other salary.

Because you donated huge sums to your nonprofit, it reduced your tax burden by a significantly high amount, and that is probably a higher amount than what your friends and relatives will pay in taxes on their paychecks in your foundation, so you were able to keep more dollars from going to Uncle Sam and among your circle of loved ones instead.

Re: How the Rich Reap Huge Tax Breaks From Private Nonprofits

#230

Post by ethbr0 » Sun, Jul 30, 2023, 8:42 PM UTC

mycologos wrote: post #220

the-rc wrote: post #180

Earlier quoted context omitted.

Isn't that what Form 211 does? You can get up to 30% of what the IRS collects. https://www.investopedia.com/terms/f/form-211.asp "In 2021, it was reported that 645 claims were submitted, resulting in 179 awards for a total of $36 million on an additional $245 million collected. In 2020, there were 593 claims and 169 awards for a total of $86.6 million paid out on $472 million in additional collections."

Nice, I was not aware of this. It looks like there are some additional stipulations: * If the subject of the claim is an individual, they must have $200k+ income in at least one of the relevant years, and the amount recovered must exceed $2mil. * You can't have obtained the relevant information through your (or your friend/partner/relative's) activities as a federal employee. * It will probably take about 10 years fo…

> So, the exercise conducted by the journalist appears to not qualify for a reward, even though in at least one of the cases it produced a collection.

The journalist (Jeff Ernsthausen) was able to bargain their way into non-public tours, that provided evidence of tax evasion.

Basic sleuthing (photos of premises from the street, phone inquiries about hours, etc) seems like it'd qualify as first-hand information.