Mitt Romney’s Tithing Problem (?)

ABC broke the news: Mitt Romney has donated millions of dollars worth of stock to the Mormon church. SEC filings disclose that a Bain partner donated $1.9 million of Burger King stock to the Church; in addition, the Church has received stock of other Bain holdings, including Domino’s, DDi, Innophos, and the parent company of AMC Theaters.

But why? Why would Romney give the Church equity stakes in bad fast-food chains, second-rate pizza chains, and other such holdings?[fn1]

Taxes. Sure, there may be other reasons, too, but there’s a significant tax advantage to donating appreciated assets to charities.[fn2]

Remember, certain donors to 501(c)(3) organizations, including churches, can take a deduction for donations they make to that organization. An example of how it works: assume that in 2011 I itemized my deductions, that I earned $100,000[fn3], that my marginal tax rate was 25%, and that I wrote a check to the Church for $10,000. As a result of my charitable contribution, I can deduct the $10,000, which lowers my tax bill by $2,500.

And, it turns out, I get the same deduction if, instead of writing a check for $10,000, I donate, for example, stock worth $10,000. I get a deduction for the fair market value of property donated.

But that stock donation may save me more than $2,500 in taxes. Because we don’t know right now what I paid for the stock. Assume, for example, that I paid $1,000 for the stock I donate. If I wanted to get access to its $10,000 of value, I would have to sell the stock. I would realize a gain of $9,000, which would currently be taxed at a 15% rate, so I would owe $1,350 of taxes. In fact, if I sold the stock for $10,000 cash, and took those bills and gave them to my bishop, I would still owe $1,350 in taxes on my gain.

But the gain is not triggered when I donate the stock to the Church. So now I have a $10,000 deduction that saves me $2,500 in taxes, and I have a potential tax liability of $1,350 that will never materialize. And, because money is fungible, by fulfilling my tithing liability with property, I’ve freed up $10,000 of liquid assets to do with as I please.

And what does the Church do with Burger King stock? It has two options: it can put the stock in its investment portfolio, or it can sell the stock and use the $10,000 it realizes (and doesn’t pay taxes on—remember, the Church, like all 501(c)(3)s, doesn’t pay taxes on its investment income) to do whatever it would have done with the $10,000 in cash that I could have donated. I suspect, in general, that the Church (and, frankly, most charities) takes the second route.

[fn1] It may be that Romney didn’t donate all of those stocks, but his campaign acknowledges that he donated at least some.

[fn2] Note that, from this point on, any motive I suggest for Romney or the Church is pure conjecture: I don’t know Mitt Romney personally. It is within the realm of possibility that he had substantive non-tax reasons for giving the Church a share of Burger King. That said, I kind of doubt it.

[fn3] I should note that the amount of money I earn is something other than $100,000. But, for the sake of mathematical simplicity, every hypothetical person I deal with earns $100,000.

76 comments for “Mitt Romney’s Tithing Problem (?)

  1. I remember a conversation my father and I had several years back. My parents both worked for a school district while I was growing up and we had very little relative to our neighbors and fellow ward members (included at the time a Huntsman). They Saved their tithing money and earned interest income on it and paid tithing in one lump sum at the end of the year. I guess at the time this was a handbook item and the Bishop called them on it, without satisfaction, and it escalated to the Stake President. My father’s basic argument was, there are members of our ward who are extremely wealthy, and I happen to know they donate their yearly bonus, or stock options directly to the church and the end of the year.

    His question:
    Help me understand why it is OK for the wealthy in the ward to have this option, while the poor apparently do not.

  2. Nothing wrong with minimizing your taxes through legitimate means.

    Nothing wrong with using the form of your tithing contributions to minimize your taxes through legitimate means.

    Nothing wrong with contributing stock or other valuable assets as tithing, since the value of $10K in the form of cash and $10K in the form of an asset with an equivalent value is equally valuable to the Church. [Hence it would be wrong to describe this as minimizing one’s tithing contribution, which is equivalent under the two scenarios.]

  3. Zionssuburb, there’s no prohibition on paying tithing in one lump sum, whether rich or poor. As a practical matter, certain tithe-paying strategies (including lump-sum donations of bonuses and donations of appreciated securities) are easier for the wealthy to accomplish (because, in general, they’re more likely to get big bonuses and own appreciated securities), but it’s available for all. If your parents’ bishop objected, either the Church’s policy has changed, or he misunderstood tithing.

    Dave, absolutely true. The post’s title and opening paragraph are meant to be slightly tongue-in-cheek. Whether, as a policy matter, not taxing the appreciation on donated assets is a good idea, this is about as uncontroversial a tax move as one could make.

  4. The tax strategy is interesting, thanks for sharing.

    Much more intriguing, however, is that the Church owns stock in AMC Theatres.

  5. Current handbook explains,

    When and How to Pay Tithing

    Leaders encourage members to pay tithing as they receive their income. However, members who wish to pay annually may do so.

    I imagine that at some point in time, that second sentence was not there. We’re going back 30-35 years.

  6. You don’t have to be ‘rich’ to pay tithing in stock. Back in the tech-bubble days, my engineer husband was given a pile of employee stock options that weren’t worth a lot… until the company was sold to a bigger company. Suddenly each stock once worth mere pennies was now worth several dollars and together it was quite a windfall. So a good chunk of those stocks were donated as tithing-in-kind to the Church, as a year’s worth of tithing in advance.

    At the time, I was told that it was SOP for the Church to sell the stocks upon receipt.

  7. I think it’s a rather silly news story–of course rich people donate stocks instead of cash, and of course Romney donates to the church he’s committed to.

    A better story would discuss why this exists in the first place–why individuals don’t have to pay taxes on the increase in value of a contribution, but can deduct the entire value of the contribution from their taxes anyway. I don’t think it’s morally suspect to do what Romney did, and contribute stock to save on taxes, but I do think that this is one of many tax laws that needs to be scrapped.

  8. Yeah, it was about 1999 when my wife an I had a knock-down drag-out over the legitimacy of paying tithing in appreciated mutual fund shares. I did it over her objection (she thought it was wrong not because of tax savings but because it didn’t feel like a sacrifice). One happy side-effect of the tech bubble bursting is that we have never repeated that argument, what with not having any appreciated mutual fund shares to contribute.

  9. Donating stock to the church (or any other charitable organization) is also a good way to diversify your portfolio. We typically let our tithing accumulate in a separate bank account until year end. We then donate to the church stock with a value equal to the balance in our tithing account. We use the cash in the tithing account to acquire stock different entities.

  10. Sam, I really enjoyed this post. Not because I think it says anything substantive about Romney, which I think you were intending to avoid anyway, but because it gives me an interesting insight into the way tax, tithing and the Church intersect.

  11. I’ve tried to figure out why this is such a story, and I do not think that it has anything to do with the fact that the Church was the recipient of Romney’s largesse, but simply that, without his tax returns, knowing that he has donated ~$4 million to the Church (most likely as tithing) helps give us a ballpark figure of his income over that period. Part of the ongoing narrative of Romney-as-out-of-touch-rich-person.

  12. The Church, like every large charity, actively solicits donations of appreciated property, especially publicly traded securities. Its right there on the front of the LDS Philanthropies web page. Most charities immediately sell the gifted assets so as not to unbalance their existing portfolios.

  13. Even 30 or 35 years ago, there was no requirement that tithing be paid monthly, or weekly, or whenever a paycheck was received. My parents usually paid tithing that way. The bishop may have counseled people to pay as they received their income, lest they get to the end of the year and find themselves short of money to pay–maybe an emergency used up their savings.

    To the main point: giving appreciated stock does seem too good to be true–fulfill your commitment to the church and stick it to the tax man at the same time. But the tax code permits it, and the Supreme Court has said that we aren’t obligated to pay any more tax than the law requires–for some reason I can’t remember the name of the case 33 years after reading it!

  14. The only reason LDS Philanthropies and other charities encourage people to donate appreciated securities is that they know the donor gets the double tax break that Sam described in the OP. Once the securities are in the hands of the charity, it makes no difference whether the donor had a huge unrealized gain, or a similarly large unrealized loss, on the securities.

  15. I think there is a much bigger deal going on here as far as the Chruch is concerned. Romney’s effective tithing rate may be as low as 1% after tax benefits. A typical wealthy person with a Federal and State tax deduction may pay tithing at an effective tithing rate of 5%. The widow and her mite with only standard tax deductions pays tithing at an effective tithing rate of 10%.

    So, the person who has the least to pay, pays at the highest effective rate. This is so unfair to the poor and needy.

    I know this is how the tax code works, but is it how the Church should work – shouldn’t we require some balancing of this? As an individual, do we really feel in compliance if we are getting 50% or 90% of our tithing right back? What kind of sacrifice is that?

    The Federal tax code also serves to favor churches with richer members compared to poorer members.

  16. Taxguy, the problem with saying “a typical wealthy person with a Federal and State tax deduction may pay tithing at an effective tithing rate of 5%” is that it misleads many unsophisticated readers into thinking wealthy people (i.e., anyone making more money than you are) pay an actual tithing rate of 5%. As if they come into tithing settlement, the bishop slaps them on the back and says, “hey, big earner, you qualify for the 5% tithing plan, here’s your rebate check.” No, there is actually just one plan and it’s 10% (and it is self-reported). If they actually fork over the cash or assets, give them their due and accurately state they pay their 10%.

    The public policy justification for a tax break for those who contribute to charitable organizations, including churches, is not to put money in rich people’s pockets, it is to give those with money to contribute an *incentive* to do so. That’s a tax policy decision made by Congress, and the incentive is, on the whole, effective at increasing overall contributions to charitable organizations. The result is better expressed by saying that Congress subsidizes charitable contributions (aka tax expenditures) than by saying higher earners pay tithing at a lower effective rate. If you’re going to play the effective rate game, then one ought to factor such items as the value of donated volunteer time and the value of LDS welfare distributions. If you value a bishop’s time, some of them probably have an “effective tithing rate” of 40%.

  17. This is a big deal because of the tax issues, not because of charitable contributions. Does anyone really think that a person as well versed in arbitrage as Romney would not chose the lowest absolute cost way to donate a full tithe to the church? I make much less than a tithe of Romney’s tithe, and yet I purchase stock at the employee discounted rate and donate it to the church for a very similar reason. Is it less of a sacrifice than writing the check would be? Yes. Is it less of a full tithe? No. Why be stupid with your money and other assets? Allocate them in the most efficient way you can.

  18. I confess that I have paid tithing on occasion by donating an appreciated asset. It was far, far less painful that paying cash, no question about it. Is it wrong? No. Is it fair? Of course not. It’s just another advantage that some of us enjoy that the poor do not. One of my bishops told me that there are people in our ward that have never paid a dime in tithing — it has all been in appreciated assets. I’ve been told by knowledgeable people that if we looked really closely at this we would find some pretty shocking things that are way beyond unfair and border on the criminal.

  19. Are you serious? Tithing, how it is paid and how much is donated is between a member and his/her Bishop. To deconstruct the act by treating it as a simple accouting transaction and then create a straw man argument about rich and poor is disgusting.

  20. Dave – I understand where you are coming from. But with a “required” tithe of 10%, tax policy isn’t very effective here as it is trying to encourage making or increasing charitable contributions. With tithing, generally, it is just providing a subsidy.

    I think it is fair to ask ourselves whether the better course of action as tithe payers is to gross up our contributions so we pay a real 10% – not just 3% after taxes. I think most of the comments acknowledge the unfairness here – we have it within ourselves to make it fair.

  21. I know the church isn’t happy about the idea, but tax deductions for charitable contributions is a subsidy for charitable organizations from the general public via the tax code. And all charitable expenses are certainly not created equal.

    So if you don’t want anyone to get these kind of tax benefits (which in actual practice are not benefits for the _contributor_ at all, but rather for the organization being contributed to) there is a very simple fix, petition your local representative to reform the tax system to eliminate this subsidy.

    Ask to eliminate the tax subsidies for starter mansions, gold plated healthcare plans, and high tax states while you are at it, because they are much worse. Reduce the rates to compensate. Broaden the base, lower the rates, etc.

  22. #20 – Please add a last name or initial if you comment again. I’ve been commenting long enough that people will think I wrote your comments.

    The issue here for most people is two-fold, especially evangelicals:

    1) Did Romney lower his taxes in an “unfair” manner?

    No. He’s smart. End of story. However, other rich people will use it to make it seem that way to the ignorant.

    2) Romney gave millions to the LDS Church.

    That is the larger issue that his opponents will try to exploit. They will say, in different words, “Look, not only is Romney rich, but he’s funding a cult. He’s not just Mormon; he’s MORMON!”

    The article in question couldn’t have been more slanted, with words chosen carefully and intentionally to present it in as bad a way as possible. It was horrible journalism, especially the opening paragraph. It reads like an anti-Mormon pamphlet.

  23. Mark D. (23) wrote: “I know the church isn’t happy about the idea…”

    Which idea, the idea that the government subsidizes charitable contributions? I don’t remember any statement from the Church about this. And if the Church hasn’t made an official statement, how could you know really? Some off-hand remark by a General Authority? Heck, the Church even backs away from some off-the-cuff remarks by Apostles!

    FWIW, I’m not quite sure that eliminating the subsidy for charitable contributions is a good idea. As a practical matter it would reduce contributions to charities (perhaps the Church would not get hit as badly as others because of the teaching that tithing is an obligation). Do we really want to reduce those donations?

    I would think that even Republicans would give that a second thought, since it might put pressure on the government to perform many of the tasks done by charities. The net result might be bigger government and less efficiency in getting those tasks done. OTOH, Democrats could easily see this as a giveaway to the rich.

    So, I’m not sure that it is a clear partisan issue, which makes eliminating the subsidy difficult, to say the least.

  24. I think it’s interesting anyone would think Romney pays anything in tithing or taxes. The money may come out of his accounts, but he doesn’t pay anything. His accountants, playing by all the legal rules that everyone has available, write the checks, etc. He just signs the forms like every other privileged person. He probably has little knowledge of the specifics of his accountancy. I am interested in doing the same financial scrutiny for all other pres. candidates and currently serving politicians. We would find the same manipulations for all, irregardless of political party.
    Meanwhile, for poor folks like me, I can tell you to the penny how much I paid in tithing, fast offerings and taxes. Every bit of it was hard earned and painful to lose. Life sucks when you are not wealthy.

  25. Thanks for writing this post, it was very eye opening. I had no idea people paid tithing this way. When I was a kid, my grandma would give me $11.11 for my birthday so I could pay my tithing and still have ten bucks. As a ten year old, I worried that that wasn’t really paying tithing. Still spent the ten bucks though. :)

  26. Lots of people are very adamant about paying on gross income rather than net income – but the tax deduction is just another way at this.

    If you pay on gross and take a deduction for it, then it is like paying net. So, for example, you make $100 and pay $10 tithing and deduct the $10 and get $4 back, you are paying $6 tithing after-tax (assuming overall 40% tax rate). A 6% effective tithing rate.

    If you pay on net, you make $100 and have offsets of $50 (includes payroll taxes) and pay $5, then deduct $2 and you are paying $3 tithing after-tax (assuing overall 40% tax rate). A 3% effective tithing rate.

    Wow, it’s hard to believe anyone rich complains too much about tithing given these tax benefits – it’s almost free of sacrifice. Especially if you are using appreciated assets and getting even more benefit from tithing. I imagine there are not many blessings for such a tiny bit of sacrifice.

    Maybe Malachi was referring to the tax code as the windows of heaven.

    Since tithing is maybe the toughest hurdle for temple recommends/activity levels – perhaps it explains why we are considered such a rich church. Only the rich people have enough deductions to make tithing so easy to comply with.

  27. OK, Taxguy, help me out here. If I pay 10% on my *gross* (pre-tax) (as I believe Romney recently claimed he does), how am I paying a lower “effective tithing rate” just because I snagged a federal tax deduction?

  28. I didn’t read through all the previous comments (too many, too long). A few years ago I had a chance to talk to the Church’s asset management team and they immediately liquidate in-kind donations when they are able to do so (publicly traded stock would fall in that category).

  29. I’m still around (#28), just hasn’t been too much of interest to me lately, but I still check in and read what is going on.

    Maybe it’s just me but if I make $100 and give $10 in tithing, that is 10% no matter how much I have to pay in taxes with the other $90. If because I paid to charity I only have to pay $4 instead of $6, that still doesn’t change the fact that I earned 100 and gave 10 of it to the church, does it?

    Now for my tithing I pay 10% of my net (after tax) and if I get a tax refund then I pay 10% of that as well because that is also an increase for me.

    This is also the first year I have had an “increase” of something other than money. I have a milk cow and a flock of chickens. I assumed that the increase to me was the milk she provided as well as the eggs I collect – I didn’t have them before but by the bounty of God I do now. I asked my branch president how he would like me to calculate tithing for that increase and he told me not to even worry about it; that if it wasn’t a monetary increase then no tithing is owed. That seems terribly wrong to me, but since I give at least 3/5 of it away to neighbors, as well as supply our local missionaries with free milk and eggs I have assumed I’m all square. thoughts?

  30. Out of curiosity, how would one use appreciated assets to pay tithing? I’m guessing the little gray envelopes wouldn’t work. Would it show up on the form your ward gives you at tithing settlement?

  31. Kent L., as a legislative matter the church is strongly opposed to a tax reform that would eliminate the deduction for charitable contributions, and have made that view known to the Congress, to various congressional representatives, and to the public at large.

    On the merits, of course, qualifying non-profits do all sorts of useful things with the indirect tax subsidy they receive from the federal government, but it is still a subsidy.

  32. wealthy people (i.e., anyone making more money than you are)

    Dave, thank you!

    Once in a RS meeting in Boca, the teacher talked about being charitable. A woman in the ward raised her hand and said, “I know! That Donald Trump is so greedy, he…”

    A friend of mine raised her hand and said, “Uh, I think the lesson is actually for us.”

    I suggest that Romney’s tithing is just the start of his charitable contributions. If you think he didn’t give enough, go write a check to make up the difference.

    One of my bishops told me that there are people in our ward that have never paid a dime in tithing — it has all been in appreciated assets. I’ve been told by knowledgeable people that if we looked really closely at this we would find some pretty shocking things that are way beyond unfair and border on the criminal.

    Yea, like bishops who feel the need to blab about private matters received in confidence.

  33. The Church has argued in favor of keeping laws that allow for the tax deduction of charitable giving. Here is a news segment video of Elder Oaks testifying before Congress on the matter:

    From a political standpoint, many staunch conservatives – who otherwise favor flat taxes or other tax code reform – still support the deduction for charitable donations. The reasoning is that many of our tax dollars are already used by the government to support charities and give research grants, without the specific vote of individual taxpayers. The tax deduction allows private citizens to decide for themselves to which causes they would like to contribute some of their tax dollars. This keeps a portion of the tax allocations in the hands of the individual citizens of the United States, which is ultimately a highly conservative principle.

  34. Interesting discussion about the different way people pay tithing. We use to pay our tithing two years worth at a time to qualify it as itemized deduction.

  35. Let us remember that separate from tithing there are a number of other funds the Church maintains to which the donation amounts are totally discretionary, such as humanitarian aid, fast offerings above the value of meals foregone, the Perpetual Education Fund, the new fund to help members travel to the temple, missionary funds, etc. There is also the Friends of Scouting program the Church promotes, even though the money goes to Scouting directly. A big recipient of separate discretionary donations are the BYU campuses and LDS Business College. All of those programs would be directly affected by loss of the charitable deduction because it would reduce pool of fully discretionary personal expenditures, beyond the scriptural mandates of tithes and fast offerings.

    I personally don’t feel a moral obligation to maximize the amount of my income consumed by the Federal, state or local governments, even though they gave paid most of my income in various ways throughout my career. One of the results of my familiarity with government operations is a resignation to the fact that government inevitably chooses the most complicated and costly way of doing everything, without any apparent concern about how costly the processing and incessant review and reconsideration of decisions is. The Federal government will spend three dollars in additional auditing and review to save two in the actual process. Most of my career in the environmental regulation of Federal activities has been built upon this principle, though my jobs have involved the mitigation of those costs. Compared to government, my observation is that Church expenditures are a lot more cost effective.

  36. One other observation on the timing of tithe paying. A lot of partnerships like law firms only make distributions of earnings to partners once a year. Until then, they are living off of savings and lines of credit. People who are self employed or otherwuse own their own businesses, such as farmets, don’t even know if they have had a net income on the business until the end of the year. Back when Mormons were cash poor (most of the 19th Century) their “surplus” was in terms of milk, chickens, hogs, and grain, and “in kind” (which originally meant “in kine” or livestock) contributions as tithing were deposited in the Bishop’s Storehouse, where some of it could be used to sustain the needy, and the rest bartered or sold to cover the cost of Church operations. If your entire annual income was based on a single harvest of sugar beets, you got your income after paying off the debt you incurred for capital and operating costs and paying anyone who worked for you, once a year. An annual tithing settlement is based on the reality that even today, many people don’t know what their 100% is but once a year.

  37. Back when Mormons were cash poor (most of the 19th Century) their “surplus” was in terms of milk, chickens, hogs, and grain, and “in kind” (which originally meant “in kine” or livestock) contributions as tithing were deposited in the Bishop’s Storehouse, where some of it could be used to sustain the needy, and the rest bartered or sold to cover the cost of Church operations.

    So, if your income still includes these types of items, how do you pay tithing on it today? I’m sure the Lord still sees it as an increase he is giving (same today as yesterday) but in a papermoney world how does one pay tithing on milk that is never sold for money?

  38. One of the big plusses for well-to-do USAmericans is that they get health insurance through their employer and generally do not pay tithing on the (usually larger) portion of premiums paid by the employer, since those dollars never actually came through your hands (but save significantly on health care costs throughout the year). I think the average employer premium for a family plan is about $12,000 per year.

    Should we be paying taxes or tithing on those benefits, which are more easily quantified than garden produce or laying hens?

  39. @Naismith,

    That’s a whole other can of worms that has been opened from time to time on the Bloggernacle. What about scholarships and expensive Christmas presents?

  40. This seems like a good time to remind those extolling the incentive effects of the tax deduction for charitable contributions that allowing the Bush tax cuts to expire would substantially enhance said incentive.

  41. Lord, please bless me that someday I might have both sufficient income to deduct my tithing and appreciated assets to tithe in kind. Amen.

  42. Taxguy (#22), my experience is many people who are in the enviable position of contributing tithing by way of appreciated assets do, in fact, make additional contributions — sometimes to other categories on the contribution slip, sometimes directly to a bishop for discretionary use to benefit local members in need, sometimes to support missionaries serving from the ward whose families are not able to support them. Again, by making the “effective tithing rate” argument, it suggests such people are gaming the system when, in fact, many or most of them are very generous with their disposable income. Many or most of them are also very generous with volunteering their time.

    Tithing, of course, is a voluntary contribution. No one has to (is forced to) pay anything. I think most of the chatter about tithing and taxes and what an economist would term “shirking” (1) is misplaced, based on hypothetical arguments that don’t really match up with facts; and (2) springs from a mixture of envy and resentment rather than some deep yearning to bring fairness and justice to the world of LDS financial contributions.

  43. If Romney is getting paying a lower effective tithing rate because of the charitable deduction, aren’t the rest of us working-class schlubs also paying a lower effective tithing rate because of the standard deduction?

    And shouldn’t we also be factoring refundable tax credits like the child tax credit and (for those of us who qualify) the EIC into our tithing computations?

  44. I have never been to this website before and I doubt I will ever come back. WOW! Seems like everyone has it all figured out here. The poor are jealous of the rich, those that pay twice a month are mad at those who pay yearly and so on. Really? Do you think that Heavenly Father intended for us to scrutinize the way our neighbor’s pay their tithing? Bottom line, IT IS NONE OF YOUR BUSINESS! I am sure that Brother Romney has paid a full tithe. Leave it at that. If you can meet with the Bishop in December and feel good about what you have done, that is all that should matter.

  45. Truth be told, tithing is essentially a regressive tax. But it is what it is.

    Mike 35 – I too pay this way (in much smaller amounts than Romney, obviously). Payments go directly to the Church Office Building. Your printout at tithing settlement shows a zero. When the bishop asks if you are a full tithe payer, you smile and say yes, take a piece of candy, and leave. Just like everybody else.

    There’s nothing wrong with following the tax code to your least disadvantage. It doesn’t mean you haven’t paid a full tithe just because Uncle Sam didn’t get a cut. If people don’t like the tax code, we change that through legislation, not church policy.

  46. It’s very interesting that the comments on the ABC site are overwhelmingly critical of Mosk and Ross’s article for implying something sinister about Romney’s contributions.

  47. What amazed me in reading many of the comments is people are worried about paying exactly 10%. And poor getting the raw end of the deal. If you don’t like being poor then find out how to be richer. (law of attraction) You can do much more good being wealthy. I was at a Mark Victor Hanson conference and he mentioned that some wealthy are reverse tithe payers. Once they became wealthy they pay 90% of their income. As an example, most should be able to live a very nice life on $100,000 net income. So once I start making substantial income were I pay myself a salary of $1 million then I will still live on the $100,000 and donate $900,000. The excess can then be split up how I feel inspired, missionary fund, temple visit fund etc. Many success coaches will tell you a very important part of success is giving. Mark Victor Hanson even has a book – “The Miracle of Tithing” (google it and you can find a link to get it free on his website) So if non-members have learned the importance of living the law of tithing, should we not be giving generously over and above the minimum? The more you give the more you get. (the “more you get” part will be in various blessings including increasing income.) So as we get wealthy lets moderate our increase in lifestyle. Do we need the big mansion as one of our prophets mentioned in a talk?

  48. MrSurfTheWeb,

    If you don’t like being poor then find out how to be richer

    I’m afraid that’s amazingly unhelpful advice; poverty has both personal and structural causes. Also, before you start donating 90% of your income (a laudable goal), you’ll probably want to talk to your tax advisor—there are some issues that you’d probably want to be aware of.

    Tithing is a fun topic, especially when it dovetails with issues of taxation, income/increase, and the like. Thanks for the thoughtful comments so far.

  49. Sam –
    Matthew 21:22 “Whatsoever ye shall ask in prayer, believing, ye shall receive.”
    Mark 11:24 “What things soever ye desire, When ye pray, believe that ye receive them, and ye shall have them” You can be poor or wealthy at ANY level of income IF you spend less than you take in. You become what you think about most often. Stop thinking about debt and poverty, think about being wealthy and giving. The law of attraction works. Pay a honest tithe and have a wealth not poverty mindset and anyone will be better off. And once I have the money to reverse tithe I am sure I will be paying tax advisors like Mitt surely is. The main idea of the reverse tax is to live simple and donate more. I will probably end up somewhere in the middle – enjoy some perks of wealth but donate as much as I can – much through my own charitable foundation that I will set up.

  50. Ah, so the lesson of the book of Job was that Job kept thinking about his whole family dying, getting boils, and sitting in an ash heap. It’s really about being an optimist, reality be damned. Good to know.

  51. H.Bob – you are using the lesson of Job to dismiss the law of attraction? The law does work on attracting negative things but does not mean every bad thing we attracted. Does not Job go on to receiving back everything he lost? There are many lessons to learn from Job – that the law of attraction does not work is not one of them.

  52. I’m glad that view works for you, MSTW – but please realize how absolutely condescending and judgmental it is toward those for whom it is not reality. Individual lives can be veyr black-and-white, but extrapolating that simplicity onto the lives of others and judging them for it just isn’t something I want to do.

    It’s the exact same arugment, at the theoretical level, as telling someone that their baby wouldn’t have died if they’d only been more positive, quit thinking about death and had more faith. Believing that about one’s own situation is up to that individual; extrapolating it onto others’ lives is a completely different action entirely.

  53. MSTW, not that it has anything to do with Romney or the post (or tithing, or anything else, for that matter), but the only laws of attraction of which I’m aware deal with magnets and gravity. (There may be some atomic attraction somewhere, but it’s been a while since I was in a physics class.)

    Mormonism is clearly not a Gospel of Wealth religion; rather, we have a complicated relationship with ideas of wealth and poverty. No ancient or modern prophet I’m aware of has made such a promise; for that matter, no economist I’m aware of would say anything of the sort. And, notwithstanding the availability of prooftexts, nothing in scripture supports the idea that if we decide to be rich (or if we live worthily enough, or whatever), we will be rich. To suggest that is insulting to our many worthy, hardworking brothers and sisters who don’t have enough to eat, and who barely have enough to get by on.

  54. @ Mr Surf the Web

    How much money have you made from the tips “Mark Victor Hansen” gave at his conference?

    And how much did it cost you to attend his conference?

  55. I am not trying to insult anyone – hopefully teach a few. I am not suggesting we all try to get rich – just wealthy – live below our means. But can we not help more poor out if we are selves are wealthy? Both in time and money? Give a man a fish or teach a man how to fish. Both are needed at times. You become what you think about most often.

    And the conference I went to was free. It was several years ago. I can’t say that any one tip made me money but I was impressed with that one concept. That is obviously not required but I am impressed that some people are doing that.

    I found his book on tithing before that. The law of tithe works. We may not be rich but wealthy if we fully live that law and live a provident life. We are here to both get a body and to fulfill our mission. That is what is important. Mitt’s mission may not to be president but his running surely has brought more awareness to our church.

    I do not want to be condescending or judgmental – just help a few improve their life. I would much rather go through life with a positive attitude than a negative poor me attitude regardless of my current wealth situation.

  56. We may not be rich but wealthy if we fully live that law and live a provident life.

    and choose a career that pays well – and choose not to have a large family if we choose a career that doesn’t pay well – and choose to live in very dangerous neighborhoods for the dirt cheap rent or house prices – and not contribute to our children’s mission and/or college costs if we are relatively poor by choice – and on and on and on

    I agree totally with the concept of living within our means, and I am not condemning anyone for how much money they make and/or accumulate (nor am I denying the great good wealthy people can be if they donate proportionately) . . . but are you really saying that Jesus of Nazareth was a bit of a loser whose practical model isn’t worth emulating? Yeah, I played the Jesus card – but only because he’s the person I envision when I consider the type of person toward whom your model would be directed – someone with enormous charisma and the ability to have turned a really nice profit and modeled relative wealth to those around him. (and George Albert Smith, based on his “personal creeds”)

    I certainly am not living anything close to that type of life, but I’ve walked away twice from lucrative opportunities and careers – knowing the practical results and relative poverty that would result. My father did it when I was fairly young – in order to save my mother in a very real way, and we grew up in obvious poverty as a result, while living within our means out of necessity. (If we didn’t live within our means, we didn’t eat.) Are you really saying that was a bad or lesser model?

  57. Great article, MSTW. Too bad it says absolutely nothing about everyone getting wealthy. It simply doesn’t address the “law of attraction” that you have been describing.

  58. “I challenge Latter-day Saints everywhere to undertake a personal, diligent, significant quest for what I call the abundant life—a life filled with an abundance of success, goodness, and blessings.” President Monson. If interested in reading scriptures related to LOA then you can go to for a free ebook. You can focus on poverty and bills or focus on abundance.

  59. MSTW, all I can do is repeat my previous comment. You’re taking something and interpreting it specifically to support your narrow interpretation of what you believe it should say.

    I’m not interested. I guess I’m just too blind to recognize and too dumb to understand. Oh, well.

  60. Ray – I was re-reading one of your posts and this jumped out “if we are relatively poor by choice” and later you said you turned down lucrative careers because it did not work with a family situation which probably was the right choice at that time. I believe that turning down those jobs were right for you but that did not mean you had to be poor. You could have found other ways to meet all of your needs in your current situation. What ever your income don’t focus on being poor, focus on an abundant life and your heavenly father will reveal a way that fits in with his will, not yours. Someone praying they will win the lottery is not likely to be granted that prayer. Find out what your mission and your passion is and look for your way out of poverty mindset to an abundant life that President Monson challenged us all to seek. Our subconsciousness mind responds to what we program it to. That is why we become what we think about most often. When we tell our mind to be poor it goes about working to make that happen. If we settle on the status quo – how our life is currently, we will not recognize new opportunities. Not everyone will become a Marriott or Romney but we can all improve our individual situation. I hope you can take off those blinders and ask heavenly father what you can do to improve your situation. Ask and you shall receive. Knock and it shall be opened unto you. Seek and ye shall find. I hope this clarifies some of what I am trying to say. Another word to consider – focus. One reason we don’t get what we ask for is we are not patient and when we don’t get what we ask for we change what we want. The timing may not be right yet or we have not learned a lesson yet that is holding us back. Find your passion and mission in life and focus and don’t give up. But we must remember “not my will but thine be done” which can be reworded “This or something better”. If what we are asking for does not fit in his will, he has something better waiting for us. And as you know regardless of how wealthy we are on earth if we live a righteous life we will have it all in the life to come.

  61. Sorry for another post but just got this in my email from a LOA coach and friend of mine. It is from a book she is having published soon. It talks about the connection between conscious and Subconscious mind.
    Our circumstances in life are the outcropping of thoughts and beliefs that have been gathered and accepted in our subconscious minds throughout our lifetime. As long as those same beliefs exist, circumstances are perpetuated and remain the same. In essence, everyone already has faith. For instance, someone who has never experienced abundance and wealth still has faith – their faith is in scarcity and lack.

    Subconscious Resistance
    Now, in order to experience abundance and wealth, one must shift those subconscious patterns and beliefs to faith in abundance and wealth. You know the glitch: the subconscious mind does not like change and will resist new ideas or thoughts that are opposed to what is entrenched. The subconscious mind keeps our heart beating, our lungs breathing, controls our autonomic nervous system and retains the perfect memory of every cell in our body, but it also keeps those negative thought forms that have been fed into it, deeply ingrained and static.

    One cannot just decide consciously to have faith. As I mentioned previously, the conscious and subconscious minds must agree on an idea in order for that idea to come to fruition and become your reality. So if you consciously want something, but your subconscious does not believe you have it, then you will not have it.

    Subconscious Acceptance through Faith and Repetition
    There are two ways in which new ideas can be accepted by the subconscious mind – through faith and repetition.


    Let me give you examples of faith as it applies to our study…

    In France, there is a legendary fountain at Lourdes, where spontaneous healings have reportedly occurred. How does this happen? The waters in the fountain are not causing the healings. When someone steps into the “holy water,” their faith and expectancy produces a reaction in the subconscious mind, which has the perfect memory of every cell in their body, and a healing is produced. It is their faith in the healing power of the waters that really does the healing.

    Another example: A parent in a moment of anger might say to a child, “You’re stupid and you’ll never amount to anything.” The child may live throughout adulthood according to that belief and never know why he or she cannot succeed – all because the element of faith was involved. In this case, it was emotional impact and belief in the parent’s authority that caused the child to accept the statement in faith subconsciously. Unfortunately, far too many people are experiencing lives that are the outcropping of such childhood influences, whether subtle or severe. I’m sad to say that some of my own private students have told me of these childhood experiences.


    Subconscious beliefs can be changed through the repetition of the desired ideas. You are currently experiencing the effects of thoughts and words that you have been repeating to yourself and continuously reinforcing. These ideas keep feeding themselves and your circumstances remain the same. You are in essence “hypnotized” by these thought forms. It is vitally important that you learn how to create and instill new information in your mind to create new circumstances. That’s where knowledge comes in – the knowledge to shift the faith factor in the direction of prosperity and the feeling that you are indeed the child of a universe that is willing to provide and fulfill all your needs.

    Once the subconscious shift occurs – and it can happen “in the twinkling of an eye” – your new consciousness is free to grow and expand into a greater and greater realization of the abundance that is in the world and your right to receive it. As your faith increases, so does the size of your prosperity container (consciousness).

    Yes, It’s There For You, Too!
    Most people already know that wealth and abundance exists. They just don’t accept that it exists for them personally. That’s where knowledge and prosperity principles come in. But in order to expand your consciousness and change your circumstances, you must be sincerely ready and willing to change. You must have an open mind and not be stuck in a state of hopelessness and defeated by what has occurred up until now. You must have even the slightest feeling that there is something better for you, and if it can happen for someone else, it can happen for you.

    If someone can transition from extreme disadvantage in the ghetto to fantastic wealth and success, isn’t it likely that someone with a better start could expand their mind to create more? There is a way, and it doesn’t matter who you are or what your life circumstances have been. You can overcome past life conditions and beliefs.

    Everyone already has faith. We all have faith that the sun will rise, don’t we? (Well, except for a rare doomsdayer). So, you already have faith. The important thing is: in what do you have faith? And what can you do to change the focus of that faith?

    You simply learn and apply the techniques, such as those you find in my writings and programs, to gently shift your subconscious beliefs so that they agree with your conscious wants and desires.

    As within, so without…

    – Marilyn Jenett

    The above is a chapter in my upcoming book, Feel Free to Prosper: Two Weeks to Unexpected Income with the Simplest Prosperity Laws Available

  62. “…within the realm of possibility that he had substantive non-tax reasons for giving the Church…I kind of doubt it.”

    Sam: I wish you could ask Mr. Romney how much he donated to his church when he was 10 years old. I suspect that he would tell you that he donated 10% of what he earned. Maybe he did that for tax reasons then too. :) Nice article, but the Truth didn’t really Prevail.

  63. the mormon teaching i received as a kid taught me that our bodies are a temple, and that we must not put poisons in our bodies as that desecrates the temple. With that said, I scrunch my nose at the thought that romney gives stock options to the church via POISONOUS FOODS. We all KNOW that these fast foods have preservatives,artifical colors, flavors and other alterants. And that is proven by the fact that taco bell, macdonalds and other are touting their NEW HEALTHY so called foods. So that tells me they recognize their regular food is POISON.

    Why doesn’t he give his tithe of stock in something he worked for. He didn’t work for that money. He makes that money off of other people actually WORKING.

    And I am just shocked that you mormons don’t see what’s is happening to this nation. Why don’t you really stand up for what is right? As in the laws of the constitution and the bill of rights? Why are you people letting this corruption and horror happen in our country? If the religious people like yourselves DON’T STAND UP FOR THIS COUNTRY, WE ARE ALL DOOMED! And you all know we as Americans are going down the drain as a nation under demos and repugs.

  64. um….

    You know water is poisonous too. There have been a number of deaths by people who diluted their blood with too much water and died from it.

    See here

  65. Marc,
    Huh? I’m not sure what you’re getting at, but I don’t even begin to suggest that Romney tithes for tax purposes. He probably gives appreciated stock rather than cash for tax purposes. And I suspect that, when he was 10, he didn’t own a ton of appreciated stock.

    Notwithstanding your “mormon teaching [you] received as a kid,” I don’t have any idea what your point is.

  66. I think it’s something along the lines of Romney is evil, the world is evil, you are evil, you aren’t doing good enough, and something else is evil.

  67. When you get paid you get taxed then with that taxed money you make purchases. A lot of purchases are taxed. We are already double taxed. And your concerned about not having to pay tax when giving stocks away?

  68. john, I’m not sure what you’re objecting to. It is absolutely true that we pay income tax and sales tax (at least those of us in states with a sales tax). But that doesn’t represent double taxation. Conceptually, double taxation is paying a tax on the same dollar of income two times. It can happen when we earn money subject to taxation by two different jurisdictions (like, for example, if I were to earn money in Brazil, I’d owe Brazilian and US income tax) or, in a more attenuated fashion, when I own equity in a corporation and that corporation pays taxes on its income, distributes its after-tax income to me, and I proceed to pay taxes on the distribution.

    That said, neither has anything at all to do with Romney, his tithing, or his taxes.

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