I have to say, the timing is uncanny. After writing a post on the legalities, or illegalities as the case may be, of taking tax write-offs for certain types of donations, namely "tuition extras" and tickets for raffles and auctions, along comes an invitation to a gala and auction.
As everyone in the Ortho-world knows, the Chinese Auction (which is neither Chinese nor an auction) is one of the most popular fundraising formats these days, even outside of the tri-state area. More often that not, it seems that the auction is accompanied by a gala that includes hor'derves, a buffet, or dessert spread.
Oftentimes, there is a price for entrance to the gala that includes a raffle ticket, which would make the entire amount paid for entrance cease to be a donation in the eyes of the Internal Revenue Service.
It would definitely be a service to help members of the community who file their taxes by the letter of the law (and, I know plenty of people who are extremely yashar in their dealings) to maximize their write-offs. This way they can give more and have more too. Unfortunately, formats like the one presented above curtail the amount of the write-off that can be taken.
However, the invitation that I received today for a gala and auction was designed to legally allow a larger donation. Instead of including a raffle ticket with the entrance, the communal organization (not frum, btw) throwing the banquet is charging an entrance fee and is selling raffle tickets completely separately. So, the deduction allowed is simply the entrance price less the value of the buffet and dessert bar.
Naturally, charitable organizations need to maximize their dollars too. So, the question that needs to be asked before trying this type of format is:
Will our supporters gamble (defined simply as pay for a game of chance) if
we do not offer them a free ticket with their entrance to the gala?
Judging by the number of raffles and Chinese auctions that we receive solicitations to far and wide, my guess is that the answer to the question for the frum market is a resounding yes.
Your comments.
4 comments:
A rabbi once told me that gambling was ussur. I guess most poskim don't hold like him?
We've never been to any of the myriad of Chinese auctions that we receive mail about. A few people we know are regulars at these events, though, and have repeatedly expressed their (mis)conception that it's a win-win - give tzedakah and possibly get some kind of prize!
My husband always thought it seemed a little oversimplified, and it's not really our thing anyway. Glad to know that you've been looking into what aspect of it is legit for ma'aser!
Chinese Auctions really deserve another post. We don't participate in them. I have participated in two in the past, but have decided not to for various reasons, including my questions on hashkafah, if not halacha. Definitely a post for another time.
Unfortunately, the reality that sends so many organizations to the Chinese Auction route is that they bring in a lot more money, from a lot more people, then letters requesting a donation ever could. The prizes are donated, the food and printing costs are usually paid for by sponsors. It's the bottom line at issue here.
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