this post was submitted on 17 Jun 2025
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The purpose of these is that the company gets to deduct charitable donations from its revenue before taxation. Even if you are in a position to give you probably shouldn't use this method.
If they'll actually open their own wallet in e.g. a fund matching program, there might be net benefit, but don't do it just to help companies avoid their fair share of taxes.
This isn't correct.
If they get an extra million in these donations, they can deduct that extra million. It's a net zero improvement. It does not help them at all financially.
But it's free good will and they can advertise that THEY donated a bunch. It's just to make them look good.
They can't actually deduct a penny from it.
They can claim it's not income and they're simply passing the money through. They don't pay taxes on it.
Because it's not income and they're just passing the money through. Why would they pay taxes on it?
They wouldn't.
My original point is that there's no additional financial benefit to the company by doing this. They don't win or lose financially.
People make these donations out to be some kind of financial scam. They're not. They're a perception scam, because the company can say "we donated X, aren't we great".
At most they can say they raised X amount for donations but that's it.
It's not a scam. Believe it or not, some people do want to help in whichever way they can
You're wrong. Companies that collect donations on behalf of a charity can't deduct a single penny of it.