Okay, my children go to a religious elementary school which is a valid nonprofit organization.
I get a tuition discount from them.
Can I donate to the school and deduct the donation from my taxes? I know that I can’t deduct tuition.
There is currently no agreement (written, oral, or even suggested) that a donation is any kind of compensation for my tuition discount.
My questions are:
1) Can I deduct the contribution?
2) Even if it is legal (or illegal) to deduct the contribution, what is the likelihood that the IRS would investigate myself or the school as a result of doing this?
3) Can I use my donations as a bargaining point for bigger tuition reductions in the future? Presumably, they would get more money if they lower my tuition and I donate more, due to tax deductibility.
–>Adam
The tuition deduction is need-based and arbitrary – they don’t have a mathematical formula for deductions of this type.
The donations would not be large in comparison to others the institution receives.
1) Yes. A religious elementary school is by definition a charity.
2) Impossible to predict. If the IRS suspects the school is accepting donations in lieu of tuition, they will investigate further.
3) No. The school knows that if they do this it could lose its charity status. If your donations are in consideration of a tuition reduction, your donations are not deductible.