The Giving Pledge

Wealthy people make public commitments to contribute “the majority of their wealth to philanthropy” by taking the giving pledge. Warren Buffett and Bill Gates, Jr. started this pledge, and now eighty-one wealthy families in total have now taken this pledge. The growing number of those participating in the initiative clearly reveals those who have not chosen to participate. For example, Steve Jobs and his widow did not take the pledge, and no Hollywood stars have pledged either.

Another clearly illuminated point is the tension between the pledge and the protection of the federal estate tax. By giving assets to charity, Warren and Bill avoid the federal estate tax – a tax both men support. To reconcile this tension, perhaps when pledge takers distribute their fortunes to charity, they should pay the federal treasury an amount equaling the federal estate taxes they would have paid absent the charitable contributions.

See Edward Zelinsky, The Growth of the Giving Pledge and the Federal Estate Tax, OUPblog, May 7, 2012.