 |
|
|
|||||
|
|
December 22, 2005 IRS Data Available on Reported Tax-deductible Charitable Giving Donations to charities, humanitarian causes and public/private institutions, reported as itemized deductions on individual federal tax returns, saw a slight decline between 2002 and 2003 in North Dakota. Contributions reported by North Dakotans as itemized deductions on their individual federal income tax returns totaled $159.4 million in 2003, compared with $161.3 million in 2002, a decline of 1 percent. However, for federal tax returns with contributions listed as itemized deductions, contributions averaged $3,546 per return in 2003, an increase of 13.5 percent from $3,124 in 2002. “What this means is that, although more North Dakotans filed federal tax returns in 2003 relative to 2002, 13 percent fewer people itemized their deductions, thus reducing the total donations,” says Richard Rathge, North Dakota State Data Center director at North Dakota State University. “However, of those North Dakotans who itemized their federal tax return and listed contributions, they donated more on average over the past year.” Nationally, average charitable contributions (reported as itemized deductions) increased 7.8 percent, from $3,461 in 2002 to $3,731 in 2003. This month’s “Economic Briefs,” a monthly publication from the North Dakota State Data Center, focuses on the charitable nature of North Dakotans by looking at charitable contributions reported as itemized deductions on federal individual income tax returns. The Internal Revenue Service publishes selected state data (including tax-deductible contributions or donations) from individual tax returns filed the previous calendar year. There are important limitations with the use of IRS data to explore trends in donations or charitable giving within North Dakota. First, only a small number of North Dakotans itemize their deductions on their federal individual income tax return. According to 2003 tax data, 17 percent of North Dakota taxpayers chose to itemize deductions on their tax returns (third lowest percentage in the nation). A mortgage is one of the primary reasons for itemizing deductions and 28 percent of households in North Dakota are owner-occupied with a mortgage, the second lowest proportion in the nation. This is due in part to the fact that North Dakota has the 12th highest proportion of renters in the nation (33 percent of all households). In addition, North Dakota has the second highest proportion of homeowners without a mortgage in the nation (42 percent). For taxpayers who take the standard deduction, no details on their donations are available through the IRS. Second, itemized deductions only capture giving that is tax deductible. “Therefore, one should be cautious in using IRS data to draw conclusions regarding how our state compares with others in charitable contributions,” Rathge says. “Nonetheless, the IRS database is one of the few uniform means of tracking contributions over time and by state.” ### Source: Richard
Rathge, (701) 231-8621, richard.rathge@ndsu.edu
Click here for a PDF version of this publication. (419Kb pdf file) |
Market Advisor: |
|
North Dakota State University |
