Friday, September 30, 2005
Flexible-spending accounts for charitable giving
I just had a brainstorm: flexible-spending accounts for charitable giving. This would allow me to bind myself to my good instincts toward making generous donations, which, unfortunately, aren't fully realized because there's always some more immediate expense that takes priority, even though I know it probably shouldn't.
The plans would allow an annual election of X amount to tax-exempt charitable organizations. As with health FSAs, the full amount would be available at the beginning of the plan year, and the participant would make his or her contributions, submit a receipt to the plan administrator, and get reimbursed. Donations would still be tax-free, but the burden on the donor would be spread over an entire year, rather than all at once. And people could still give additional amounts, of course, in excess of their plan elections. In my case, it would absolutely increase the overall amount of my charitable giving, and would save me from myself(ishness).
You'd have to limit it to cash donations, of course, because I don't think we'd want plan administrators adjudicating whether that bag of clothes I gave to Goodwill was worth $30 or $50, but I see no reason why this wouldn't work swimmingly.
Has anyone proposed this? Who could make this happen?
The plans would allow an annual election of X amount to tax-exempt charitable organizations. As with health FSAs, the full amount would be available at the beginning of the plan year, and the participant would make his or her contributions, submit a receipt to the plan administrator, and get reimbursed. Donations would still be tax-free, but the burden on the donor would be spread over an entire year, rather than all at once. And people could still give additional amounts, of course, in excess of their plan elections. In my case, it would absolutely increase the overall amount of my charitable giving, and would save me from myself(ishness).
You'd have to limit it to cash donations, of course, because I don't think we'd want plan administrators adjudicating whether that bag of clothes I gave to Goodwill was worth $30 or $50, but I see no reason why this wouldn't work swimmingly.
Has anyone proposed this? Who could make this happen?
