Earmark fixed percentage of income for charity

Aryeh Leib Taurog vim at aryehleib.com
Tue Feb 1 15:42:31 EST 2011


Mike or Penny Novack wrote:
> 
>>
>> John, thanks.  This is what I was trying to get at when I posted the 
>> question.  I got this same suggestion off-list from someone else, who 
>> also pointed out the caveat that the Expenses:Charity account will not 
>> necessarily reflect how much you actually gave to charity in a given 
>> period, only how much you were supposed to give.
>>
>> Regards,
>> Aryeh Leib
> 
> Did you mean to say this? Or are you confused?
> 
> The Expenses:Charity account should hold the ACTUAL donation 
> transactions and so will reflect what you actually donated.
> 
> If you "reserve" a portion of your income that amount is NOT an actual 
> donation until you make the donation (at which point you "unreserve" the 
> amount of the donation)
> 
> Michael

I did mean to say this, because that's how John G's system works. 
Take a second look at his message, or just read on; I'll include below 
the message to which I referred above.  I don't have all the 
double-entry accounting terms down yet, but the way I understand it is 
that we use the Expense:Charity account to set the balance in the 
Liability account, and then pay that off from various asset accounts 
over time.  So the ACTUAL donations will be split between the asset 
accounts out of which they were paid and the Liability:Charity 
account, but would not appear in the Expense:Charity account register 
at all.  That account is only used to adjust the Liability:Charity 
account when entries are made in the income accounts.

davelist at mac.com wrote:
 > I think Michael's suggestion of periodically seeing if your charity
 > donations total 10% of your income is the way to got, but if you
 > really want to do it, I think you can using a liability account:
 >
 > 600 Income:Freelancing
 > 600 Assets:Checking
 > 60 Expense:Charity
 > 60 Liability:Charity
 >
 > and then when you write the check to the year it becomes:
 > 60  Checking
 > 60 Liability:Charity
 >
 > At the end of the year, you need to write a check to get the
 > Liability:Charity account down to zero.
 >
 > If you wait until the next year to write that check, you have the
 > problem that your charity expenses won't match watch you actually
 > contributed to charity (which you may want for filling our your tax
 > returns).
 >
 > Dave
 >
 >




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