It’s Actually Ok To Round Up At Checkout

It’s Actually Ok To Round Up At Checkout

I keep seeing posts about how you shouldn’t round up your payment at checkout “for charity” because the company takes the money, gives in their own name, and then receives a tax break for the donation.

This is incorrect. It’s just plain wrong information. 

Because it’s illegal for a company to claim collected donations on their taxes, since they give you a receipt that proves you can claim it on yours. They are considered a collection agent – the corporate equivalent of a firefighter with a boot soliciting on the sidewalk.

And the sentiment is potentially fucking nonprofits out of serious change.

So here’s how it works. When you make a purchase you’re asked if you’d like to round up your price, say $22.70, to $23 and give that extra 30 cents to charity. When you choose yes, the company adds that as a special charge, and transfers the amount to a processing company. The processing company disburses many small gifts in one big chunk to the nonprofit, so that the nonprofit doesn’t get ten thousand transactions of thirty cents. Over the course of a couple of years, campaigns like this can raise millions for the nonprofit. 

So where’s the catch? you’re thinking. Capitalism doesn’t allow kindness like this to rampage unchecked!

Well, you’re kinda right. For one thing, there’s something called the Halo Effect, where companies get a huge PR boost from this giving. People feel better about themselves and the place they give, when they give this way. That’s why companies do it, pure and simple. It’s cheap, built-in positive messaging. 

The companies aren’t deducting it (it’d be chump change to them anyway tbh) but you can. You can literally deduct the thirty cents you gave at Jersey Mike’s off your very own taxes, if you keep the receipt. But unless you’re giving more than $6K to charity each year ($12K if you’re filing jointly!) then there’s no point keeping that receipt, because before that threshold you won’t get a tax break for charitable giving anyway.   

One significant benefit of giving at checkout is that the nonprofit doesn’t get your name or address, so you never go on a mailing list. If you give an average of 30 cents twice a week when you buy a soda at the gas station, over the course of a year you’ll have given over $30 commitment-free. Sweet deal. 

Here’s what most people think is the catch: between three and seven percent of the money given goes to that processing company I mentioned. Because they have to, you know, process that money, which comes with expenses like software, customer support, servers, bank fees, etc. 

However. Three to seven percent? That’s nothing. A good fundraiser working for a nonprofit costs, in salary, roughly 20% of what they raise. For every dollar they earn, they bring in about $5 from donors. Round-up campaigns raise $5 and charge you 25 cents for it and require almost no work from the charity – that money just shows up. And even if you didn’t give at the checkout, if you give online we pay a processing fee to the place processing THAT payment. If you give by check or cash, we still have to pay people to count, record, and deposit those payments. Giving money costs money. That’s just the way it is.  

2. Unless you actually are giving elsewhere, if you choose not to round-up, then you’re just…chest pounding. You’re pretending to stick it to the man when really you’re just not making a charitable gift at all. If you do give elsewhere that’s great, keep up the good work, I’m not talking to you. And if you can’t afford to give, I’m really sorry, I want you to keep your money and I’m also not talking to you. As we know, thirty cents adds up. I couldn’t give for several years, and it’s a point of pride now to always be able to hit the round-up button without doing any math. 

But if you could give and aren’t giving somewhere…then no offense but you have no skin in this game and you need to sit down and let people who give a shit get on with their work. 

Because an additional truth is that some people only remember to give when they’re asked but they HATE TO BE ASKED, except at checkout. And some people only give if they feel like they’re giving insignificantly relative to their income – like thirty cents at checkout. These campaigns are nearly-free, super-easy money for us from people who probably wouldn’t otherwise give. They raise our profile, too, so that people who have given at checkout think of us when they DO remember to give (like oh, around the holidays, which are fast impending). 

In the end, I suppose I’m really just begging people, as a whole, for about the seventh or eighth year running, to stop coming to charitable giving from the standpoint of “Well whaddaya give me for it? Where’s the catch? How do I know you’ll do the best with my money? Can you prove you aren’t a scam?”

I know that most of you, most of the time, come to any relationship with an inherent assumption of good faith – from tv shows to friendships to Etsy purchases to pet ownership. You’re not deeply suspicious by nature! But this lingering hostility towards charitable giving, where the immediate assumption is one of bad faith, is really harmful to people who are attempting to do good work. An extremely small fraction of the nonprofits that want your funding are scams, religiously sketchy, or deeply negligent when it comes to how your money is eventually spent. Most are doing their best and many are putting up with a lot of unnecessary fucking side-eye while they do it.

So try to downshift from “Who will scam me the least” to “Who would I like to help the most?” and give accordingly. Whether that’s a local pet shelter, a toy or blanket drive, a national cancer organization, your friend’s top surgery gofundme, or the woman standing in traffic with the cardboard sign. Your blood pressure (and mine too, for that matter) will go way down.