Is It Right for Christians to Reduce Their Taxes to a Bare Minimum?

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It was recently reported that a very prominent billionaire paid only $750 in federal taxes in 2016 and 2017. Is it right for Christians to try to reduce their tax burden to a bare minimum?

We all depend upon governmental structures and services—parks, roads, law enforcement, national defense, social security, or unemployment benefits when life throws us a curveball. Such things aren’t free. At the same time, it’s understandable that few of us like to pay taxes. We’d rather use that money for other things. Moreover, the tax code is complex and sometimes infuriating. When we hear about wealthy corporations or individuals paying a smaller percentage of their assets on taxes than less affluent companies or individuals, it’s understandable that we get suspicious about inequities in the system.

We also know that Reformed Christians have varying philosophies toward taxes and the government initiatives they pay for. Some believe that “big government” is inevitably inefficient, creates unhealthy incentives, and siphons money from the more promising arena of private enterprise. Others believe that relying mainly on private enterprise easily ignores problems and needs that can only be addressed effectively at the larger scale of government.

While such disagreements will undoubtedly persist, the Reformed tradition historically has stressed the importance of good government because order is integral to creation and necessary to restrain the effects of sin. We live in community and are responsible not just for ourselves, but also for the common good. The purpose of government is to protect and promote the common good.

With taxes, our motives are important. Do I strive to reduce my tax obligation because of genuine beliefs about the superiority of the private sector (including the church) helping the needy and promoting the common good—and do my giving and spending patterns reflect that? Or is it rooted mainly in a desire to keep more for my own private benefit?

One way to love our neighbors as ourselves is to cheerfully pay our fair share of taxes for the common good while encouraging those funds to be spent wisely, efficiently, and effectively.

About the Author

Matt Lundberg lives in Grand Rapids, Michigan. He is a member of Boston Square Christian Reformed Church and the director of Calvin University’s de Vries Institute for Global Faculty Development.

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Comments

Not reducing one's income or other taxes essentially amounts to cutting a check to the government as if it were a charity.

Anyone who thinks that their government, at whatever level, is a good recipient choice for their charitable cash contributions strategy is certainly free to do that.  As for me, I think that would be a really, really, poor choice.

As someone who has a fair amount of tax experience (I have a Masters Degree in Accounting, and I'm married to someone with a Masters Degree in Taxation), this column is humorous. Taxes are what they are. The legislature passes tax law, and the revenue department issues interpretations and guidelines for how to follow those tax laws. Obviously Christians should follow those laws, guidelines, & interpretations to the best of our ability, as that is the honest thing to do.

If that means you follow certain strategies to reduce your tax liability (i.e. contribute pre-tax dollars to medical savings accounts or retirement accounts, etc), then that is being wise & prudent. And it's also a completely honest and acceptable way to handle your finances.

The reason I say this column is humorous is because the only way to increase the amount you pay in taxes, above & beyond what the law says you should pay based on your taxable income, is to LIE about your income and say it was higher than it actually was.

So I guess if you go to file your taxes, and you think the amount you pay based on the law is too low, you're supposed to lie and say your income was actually higher than it was?

As a tax professional and CPA I echo the comments by Mr. Winiarski. Tax code and law is incredibly complex. Maybe that taxpayer had losses in the previous year and carried that loss to that particular year.

Secondly, I would add that the tax code is riddled with tax incentives based on spurring economic activity (also including environmental and social engineering incentives). If a billionaire is paying little in tax (based on tax law before their time), it's also a likely possibility that taxpayer invested in building and improvement projects and thereby created jobs and supported families through those projects.

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