Income taxes: the royal path of philanthropy

to Help other people and pay less taxes. This dual effect winner remains untouched by the tax reform, which is in the offing. Detailed review of devices unbeatable.

Some taxpayers are still unaware, but no system of tax exemption is no longer effective to lower its taxes as philanthropy. Give to organizations of general interest gives discounts up to 75% of the amounts given, and reductions in wealth tax (ISF) by 75%. Even the tax benefits of the strong, granted on investments that are risky, do not generate as much tax savings as compared to the money spent.

donations to organizations of public utility in the broad sense (medical research, animal protection, the environment or cultural heritage...) give right to 66% of tax cuts, within the limit of 20% of taxable income, under article 200 of the general tax Code (CGI).

Up to 75% tax reduction

The concept of general interest can also take advantage of this tax reduction of 66% on donations to institutions of higher education, or artistic, to academic foundations, to the last of the cult or to some show rooms, and even to political parties or to support newspapers, through the association Press, and pluralism set up with the Caisse des dépôts.

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Among the organizations not-for-profit general interest, the tax office distinguishes between those "who proceed to supply free meals to persons in difficulty, that help to foster their housing, or who shall, as principal, to the provision of free care to persons in difficulty." Under the device "1ter" of the article 200 of the CGI, "said" amendment Coluche", they receive a tax reduction of 75% on donations up to 530 euros per year, and 66% thereafter.

These charitable organizations eligible for the tax reduction of 75% are many Restaurants in the heart to Doctors without borders through the Red Cross. Donations to these organizations of emergency assistance to persons in distress are not limited to 530 euros per year, for the portion of donations exceeding this amount benefits from the tax reduction to "normal" of 66%.

Through this mechanism, more than 5.5 million tax households have reduced their income tax by making nearly 2.5 billion euros in donations in 2015, according to the latest Research study & solidarity on the generosity of the French. The subject to the ISF are also entitled to a reduction of ISF equal to 75% of their donations to recognized foundations of public utility, or sites of insertion, up to 66667 euros of donations, or 50000 euros discount.

The philanthropic strategy of the big heritage

The fiscal reform and the transformation of the ISF wealth tax on the estate (IFIS) do not negate these benefits, but the philanthropic sector are concerned about the impact of the exemptions announced. More than 43000 persons liable for payment of the ISF had made donations, reducing the tax, for amounts of € 220 million in 2015, according to the same study, which forecast an increase of these gifts to 250 million euros in 2016.

With the exemption of financial assets in order to focus on the only real estate assets, a lot of persons liable for payment of the ISF will be exempt from the IFIS, especially the "small" taxpayers ISF, "that is to say, the vast majority of them, since about 50% of taxpayers would be in the first income bracket, and 90% in the first two slices," said to Me, Xavier Delsol, a member of the committee of experts of Research & solidarity.

These are liable for the wealth tax with a heritage of lower to 2.57 million euros, accounted for two-thirds of the donors who have benefited from this tax reduction in 2015. The "big" liable for ISF donate higher: those with 5 to 10 million of heritage are 15000 euros per year, and 25,000 euros for those with more than 10 million.

"generally speaking, donors have a big heritage have the means and a philanthropic strategy that help us to ensure the sustainability of our commitment to some long-term projects", explains the head of the philanthropy, an organization dedicated to medical research.

The reform of wealth tax could reduce the gifts

If there is less of EWB défiscaliser, it can also be the fear that some have reduced their gifts. According to some projections, the reform of the IFIS could drop the donations eligible for this benefit by more than half, unless the removal of tax cuts Tepa for investment in SMES results in a deferral of the effort of tax exemption to the benefit of philanthropy.

"You can always ask for more, but we did not have a bad tax system. People have access to all the devices philanthropic possible with tax cuts not negligible," says Francis Charhon, senior vice-president of the foundation, Doctors without borders. For him, the tax exemption is not the act trigger donations, even if the hints tax has a multiplier effect by allowing donors to give more.

With the tax reduction of 66%, a donation of 100 euros costs only 34 euros, couldrisk you get 66 euros in tax reduction, and only 25 euros with a one-time tax reduction of 75%. Even if they have fewer IFIS to défiscaliser that EWB, Francis Charhon hopes that donors will defer their donations on the tax reductions on income.

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"Between 66% and 75%, it is only gap of 9 points. My message to donors is to think first of their philanthropic act, even if they give a little less". Today, we can already save you 1000 euros of income tax by 1443 euros of donations, divided between 530 euros donations are eligible for 75% reduction (397 euros of tax benefit), and 913 euros of donations with that of 66% (or 603 euro economy). Philanthropy is a charity to pay less taxes.