Beginning January 1, 2011, working Americans are going to realize a 2% increase in their paychecks. As part of the extended Bush tax cut plan passed by congress in December, payroll taxes (also called FICA taxes) have been reduced from 7.65% to 5.65%.
Payroll taxes go to fund Social Security (6.2% on income up to $106,800) and Medicare (1.45% with no income limit). For a person earning $106,800 in 2011, their tax savings will equal the maximum $2,136.
For those ministries who have been diligently encouraging their congregations to “step up” their giving, there is now a new source from which giving can occur. If your church is in a capital campaign season, your participants have a new pocket from which they can fulfill their financial commitments.
Many sought God’s leading in making those commitments, stepped out in faith to make a pledge, and counted on God to provide ways for them to fulfill the faith commitment. Could this be one of those ways?
NOW is the time to educate everyone to their new tax savings (which they will realize in their first payroll check in 2011).
Too often new income, whether from raises in salary or performance bonuses, goes to fund increases in lifestyle.
NOW is the time to persuade they not change their lifestyle, even temporarily, with this short term gain.
NOW is the time to encourage them by suggesting they earmark 50% or more of these tax savings for their charitable giving in 2011.
One final point – you might as well give away this short term gift from congress – otherwise it becomes taxable income!