This Article examines the tax treatment of charitable contributions and concludes that contributors who do not itemize their deductions (nonitemizers) should contribute their services to charity whenever possible rather than contributing cash or property. Charitable donees similarly should embrace opportunities to accept and utilize service contributions from their donor bases, give service contributions as much recognition as money or property contributions, and encourage their lower-income donors to render services rather than giving money earned with performance of services. The Article suggests that nonitemizing taxpayers are the donors who have the most “skin in the game” for charitable contributions in terms of sacrifice. Promoting service rather than money or property contributions maximizes the tax subsidy of the charitable contributions. From the perspective of efficient tax planning for low and moderate-income taxpayers, the tradition of volunteerism in the United States is compelling. Yet, despite the ability to get more “bang for the buck” from service contributions, many charitable organizations that used to rely on volunteers for support increasingly have shifted their operations to reliance on paid staff and pushed even the low-income members of their donor base to contribute money rather than volunteer services.
Ordower, Henry, Charitable Contributions of Services: Charitable Gift Planning for Non-Itemizers (November 30, 2012). 67 The Tax Lawyer 517 - 545 (2014); Saint Louis U. Legal Studies Research Paper No. 2012-29. Also available at http://dx.doi.org/10.2139/ssrn.2182865