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Tithing and taxes
By Orson Scott Card February 11, 2010

Growing up, I was taught that tithing consisted of ten percent of our increase. In my parents' family, "increase" was defined as gross income, including salary before taxes.

But my dad and mom often made extra money, beyond salary or wages -- my dad from his sign painting and photography, my mom from typing dissertations and other projects.

My dad explained once that in defining the tithing on a one-shot part-time sign painting job, he really should deduct, as any other business does, the cost of materials. "But that feels to me like nickel-and-diming the Lord," he said, so he didn't bother making deductions -- he tithed on the whole amount he was paid. "Still, wouldn't be wrong if somebody else chose to deduct those costs," he explained.

He told me that when he owned an actual sign-painting company, he based his tithing on the income after deducting the costs of employees, equipment, and so on. "The company didn't pay tithing on its gross receipts, I paid tithing on the portion that was my increase."

That's what he believed was right, after prayer and consultation -- with my mother first, and then, together, with the bishop.

As I got older, I learned what tithing money was used for, and the many spiritual and temporal reasons why it's essential to pay that ten percent.

I also learned about taxes. We as citizens might disagree about how our tax dollars should be spent, but most of us agree that it's good to pool a portion of our resources in order to accomplish tasks that could not be done as well or as conveniently by private enterprise.

Both tithing and taxes are based on a percentage of our income. We pay tithing in obedience to the commandments of God; we pay taxes in obedience to the commandments of men.

When we account for our tithepaying to the bishop each year, what we work out with him, after his questions and suggestions, is our full tithing obligation. It's not his job to demand our records or check with our employer or the bank. Ultimately, it's between us and God.

When we account for our taxes, we need to include proofs of income, and must stand ready to be audited by someone with the authority to take from us what he thinks we should have paid.

A tax system that was handled the way we work with tithing would leave an ever-shrinking number of honest taxpayers to provide government services for the dishonest ones, which would soon leave the government unable to perform its vital functions.

And who would join a church that dealt with tithes the way the IRS (in America) deals with taxes? Paying tithing would not count as righteousness if it were compelled.

Here is a good rule: Prepare your taxes so honorably you would not fear laying your calculations before the Lord. And figure your tithing so carefully you would not fear an audit from the IRS.

It's quite possible that you'll find you can't use the IRS's definition of "taxable income" as the exact basis for the "increase" you pay tithing on.

For one thing, you probably deduct your tithing donations from your taxable income -- and it would hardly do to subtract your tithing before calculating your tithing, for then you'd end up paying only nine percent!

The government allows all kinds of exemptions and reductions in order to encourage us to engage in certain activities. There's a deduction for the interest we pay on a mortgage. Certain kinds of income are taxed at a very different rate. There's a minimum income beneath which you pay no taxes at all. None of these should reduce our tithing.

The Lord's system seems simpler, because it's a flat rate: Ten percent of your "increase" for the year, no exceptions.

But it's more complicated than that. If you're taking every lawful deduction that the government authorizes, you may end up with a much lower number than the one you ought to base your tithing on.

You are not cheating the government, as long as you follow the law; but the government doesn't have the authority to decide what you can or can't exempt from your tithable income.

Do you count the portion of your health insurance your employer pays for? When you go to the doctor and don't pay the full cost of the treatment, aren't you receiving "increase"?

And what do you do about a 401K? When your employer matches your savings in such an account, isn't that income? Or do you wait to pay tithing on the 401K until you withdraw from it after you retire, so you don't tithe even the portion you contribute now?

What about the money paid into Social Security? If we tithe that money now, does that mean our Social Security benefits are already "pre-tithed"? Or should we figure out how much our employer is paying into the system, and count that as increase right now?

Or, when we retire, do we add up our lifetime contributions to Social Security, on which we already paid tithing, and don't pay tithing on it until the benefits exceed what we paid in?

I do not know the "right" answer to any of these questions, and the official Church response to questions like this is always the same: Pray -- and consult with your bishop.

The last thing the Church wants or needs is to develop a "tithing code" like the government's hundreds-of-pages tax code! Besides, then we'd be tempted to find loopholes.

Here's what I think should be the "code" we follow in figuring our tithing:

If, after deciding on the "increase" you intend to tithe, you feel bad or uncomfortable or can't stop wondering whether it's right, or if you feel like you're getting away with something, then maybe you need to pray a while longer or talk to the bishop again and make a change or two.

And even after an honest, full tithing, there's nothing stopping you from consecrating even more of your increase as fast offerings and other donations.

Copyright © 2010 by Orson Scott Card

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