Charitable Deduction — A New Analysis
David Pozen (Yale University – Law School, Class of 2007) has published the abstract of his article Remapping the Charitable Deduction on SSRN. The full article will be published in Volume 36 of the upcoming Connecticut Law Review (2006).
Here is the abstract:
If charity begins at home, scholarship on the charitable deduction has stayed at home. In the voluminous literature on the deduction, few authors have engaged the distinction between charitable contributions that are meant to be used within the United States and charitable contributions that are meant to be used abroad. Yet these two types of contributions are treated very differently in the Code, and raise very different policy issues. As Americans’ giving patterns and the U.S. nonprofit sector become increasingly international, the distinction will only become more salient in the years to come.
This Article offers the first exploration of how theories of the charitable deduction apply to internationally-targeted donations. In so doing, the Article aims to inspire not only a methodological shift in nonprofit tax scholarship (a strategic remapping), but also a reappraisal of the deduction literature (an analytic remapping): Just as existing theories of the deduction can inform our understanding of foreign charity, considerations of foreign charity can shed light back on the existing theories.
I argue that the standard rationales are underdetermined and undertheorized, and propose a new, integrated approach to the charitable deduction. Internationally-targeted donations emerge from the analysis holding a strong claim to the deduction – often a stronger claim than domestically-targeted donations hold – on almost every relevant dimension, which calls into question current regulations that privilege domestic giving. Oversight and foreign policy concerns, however, complicate the ideal of geographic neutrality and illuminate the charitable deduction’s role as an instrument of global politics. In multiple senses, then, admitting foreign charity into the debate both intensifies and recasts the problematics of deduction theories; but it gives them a chance at coherence.
I argue that the standard rationales are underdetermined and undertheorized, and propose a new, integrated approach to the charitable deduction. Internationally-targeted donations emerge from the analysis holding a strong claim to the deduction – often a stronger claim than domestically-targeted donations hold – on almost every relevant dimension, which calls into question current regulations that privilege domestic giving. Oversight and foreign policy concerns, however, complicate the ideal of geographic neutrality and illuminate the charitable deduction’s role as an instrument of global politics. In multiple senses, then, admitting foreign charity into the debate both intensifies and recasts the problematics of deduction theories; but it gives them a chance at coherence.
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