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Computing Maaser - How much tzedakah (charity) do I owe?
by Rabbi Dovid Bendory
II Adar 5765 (March 2005)
Use my Maaser Calculator to compute your
We all agree that it is a mitzvah to give tzedakah, but few of
us understand the actual requirements with regard to how much to give, what
qualifies as tzedakah, and when it must be given. The purpose of this
essay is to spell out the requirement in a form that is easy to understand and
straightforward to follow. It is my hope that this will lead all of us to proper
observance of the mitzvah of tzedakah. Please keep in mind that
this essay is for informational purposes only. For actual halacha, please
consult with your rabbi.
How much to give?
A Jew is required to tithe his money and donate between one-tenth and
one-fifth to tzedakah. For someone who is just begining to donate to
tzedakah, this is best accomplished by giving away at least one-tenth of
his net worth immediately, then donating at least one-tenth of his income each
year. This can be a daunting consideration at first, but don't despair; instead
begin giving small now and work up to the minimal one-tenth requirement. Also
note that it is forbidden to give more than one-fifth as we are concerned that a
person who gives away too much will become impoverished and come to rely on
tzedakah himself. (This limit does not apply to those who are extremely
wealthy.) The requirement to give one-tenth is referred to as maaser, a
Hebrew word translated as "tithing".
When must the maaser be given?
Maaser must be given immediately, that is, as soon as you earn your
money you have an obligation to tithe from it. The Chofetz Chaim says
that it is praiseworthy to give smaller sums frequently. One who gives a large
lump-sum once yearly will only think about tzedakah once per year; one
who gives small sums frequently will always be thinking about tzedakah
This will mold his character by making him into someone who is always looking
for opportunities to give tzedakah. Thus it is common practice for
religious Jews to give tzedakah several times daily, often when attending
services at synagogue, in addition to making periodic large contributions.
How much should I give? Use my Maaser
Calculator to find out!
It would be simple to compute maaser if you received all of your money
once per year, as you could immediately make a payment of one-tenth, but a
modern economy is quite complex. Paychecks may come weekly, but tithing each
check individually might not be practical when money must also be set aside for
monthly rent payments. And what about capital gains and losses, or once-yearly
commission or bonus checks? What about taxes withheld or paid — how do these
figure into maaser computations?
I recently began using a new accountant who is a Torah Jew and commented to
him that we should be able to compute my maaser requirement on an annual
basis from my tax return. What follows is an explanation of this computation
using a standard US 1040 tax
return. Based on this explanation, you should be able to easilly make the
same computation with a 1040A, 1040-EZ or your country's
First, we must determine: what is our income for maaser
purposes? The general rule to follow is simple: Hashem is your
partner in your income. In computing your maaser income, you can deduct
the normal and acceptable expenses that any other partner would allow you to
deduct. What you couldn't deduct from a flesh-and-blood partnership you can't
deduct form Hashem either. Thus:
- You can't deduct the cost of living such as housing expenses or the cost
of owning a car.
- You can't deduct the cost of food or clothes (except for clothes required
for your business, such as your uniform if you are a police officer).
- You can deduct expenses incurred purely for the purpose of earning
your income such as the cost of your uniform (above), normal commuting costs
(more on this below), or the expense of margin interest as offset by
investment profits (Schedule A line 13). In general, Schedule A line 20 is
- Personal expenses, such as the cost of food while doing business or on
business travel, are not deductible for maaser purposes even if they
are deductible for tax purposes. Thus if I entertain a client at dinner and
the dinner costs $100, and if this dinner and such an expense is deductible as
a normal business expense, and if eating dinner at home would have cost me $5,
then $95 is deductible as a maaser expense.1
- By the same token, dry cleaning expenses while traveling are only
deductible to the degree that you occur additional expense due to your
required business travel. (This is typically the case in a hotel where laundry
and dry cleaning are very expensive compared to what you would pay at home.)
- In general, you can use commonly accepted accounting standards for the tax
or accounting jurisdiction in which you reside.
Based on these rules, to compute your maaser income:
Use the same accounting standard used for your tax
return. This gives you your preliminary gross maaser income before
deductions — line 22 on your 1040.
- Add in some tax-exempt income as follows.
- Add in tax-exempt interest from line 8b.
- Add in qualified distributions from line 9b.
On lines 15, 16, and 20, the full income is included as maaser
income, not just the taxable portion.
Add in health insurance premiums, FSA expenses, and dependent-care
expenses that were excluded from your W-2 income as reported on line 7.
While this income is not taxable, it is maaser income.
Tax-free income that went into a retirement (or other) account
designated specifically for you that has no required vesting period
— such as contributions into your 401k, tax-deductible IRA
account, or non-qualified deferred compensation program is not
considered maaser income in the year it is earned; instead, it
will be considered maaser income in the year it is received.
(Note: not everyone agrees with this. Some hold that this income is
liable for maaser in the year it is earned and is then received
- As a general rule for other cases not outlined above:
don't include income that will be taxable in a coming year (like 401k
include income (or benefits) received this year on a tax-free basis
(like FSA income).
- Add in some additional items that may not be taxable but are liable for
- Capital gain on the sale of private property is
included as maaser income, but adjust for inflation when computing
the cost. Thus, for example, gains on the sale of a personal residence is
maaser income. To adjust the cost basis for inflation, use a
- A capital loss on private property can be deducted from maaser
income, but it can only count to offset the gain on the sale of private
property. For example, if you sell your 5-year-old car at a capital loss
versus the depreciated value, you can deduct this loss against your capital
gains on the sale of your home. If you have no such capital gains, you
cannot deduct this loss against W-2 income as your car (like your home) is
not purchased for investment purposes but rather is property held for
- Donations of appreciated stock to charity are
deducted at the appreciated value for tax purposes and the capital gain is
not reported as income. These will appear on your Schedule A line 16.
For maaser income, you need to add in the value of the capital gain
as income. This is computed via form 8283 Part I by
subtracting Column f from Column g for the donation in question. Note that:
- The entire value of Column g is considered maaser if donated to
an appropriate maaser recipient.
- Part II is irrelevant unless you did not donate 100% of your interest
in the property; in that case, you'll need to multiply the amounts by the
- Page 2 is irrelevant as well.
- Your Schedule C,
E income are all
maaser income. Expenses or deductions taken directly on these forms
(business expenses on Schedules C, C-EZ, and E, or offsetting losses on
Schedule D) are deductible from maaser income reported on the same
- Benefits paid on your behalf by your employer for your
benefit are considered maaser income. For example, if your employer
pays non-taxable moving expenses or gives you a tuition reimbursement, these
are both liable for maaser income. But a hotel that your employer pays
for while you are travelling on business is not for your benefit and is not
income. (You are staying at the hotel for your employer's benefit, not for
your own enjoyment. The fact that you enjoy it is irrelevant. Similarly, if
you employer pays for meals when you travel or when you work overtime, these
are also not maaser income, as you are eating them where and when your
employer requires you to do so.)
- Gifts and inheritance received are unquestionably
maaser income regardless of whether or not they are taxable. This
includes wedding gifts — which are best tithed en masse when received.
Inheritance similarly should be tithed on receipt — even though the person
you inherit from already tithed, the inheritance is maaser income to
you on receipt. (This is similar to terumat maaser, a maaser
that the Levi gives to the Cohen from the maaser rishon that the Levi
receives. Even though terumah gedolah was already given to the Cohen
prior to the taking of maaser rishon, the Levi owes terumah on
the maaser that he receives.)
- You now have added up your gross maaser income. Next, compute your
You may deduct normal (not excessive) commuting expenses. For example, I
work in New York City. The normal way to commute from my home area to my
workplace is to drive to a nearby commuting point and take the train. I can
deduct the mileage involved in driving to this location, the normal cost of
parking, and the normal train fare. In my case, this is 20 miles (round
trip), $4 per day of parking, and $1.35 each way for the PATH train. Now I
may park one day in the expensive $7 indoor lot, but I don't get to deduct
$7 as $4 is the normal cost of parking. Similarly, if I decided one day to
pay $100 to be driven to work in a limosine, I would not get to deduct $100
but only the normal expenses as outlined above. (Yes, this is a subjective
measure. When deciding what is "normal", keep in mind that Hashem is
your partner and that He will be most unhappy if you are inflating your
expenses.) Use the IRS business
mileage deduction rate to compute the deductible cost of your commuting
You may not deduct any allowance for household or living expenses such as
food, rent, or mortgage.
Deduct non-taxable income that
will be liable for maaser in the year received such as contributions
to a retirement account. In general, form 1040 lines 25 and
32 are deductible.
Deduct any income you never received such as that
reported on form 1040
line 33, but only to the degree that this deduction was taken from income
rather than from the initial investment.
Alimony paid (1040
line 34a) is not deductible; however, to the degree that your ex-spouse
would be in poverty were it not for your alimony paid, these payments
may be considered maaser donations. Consult with your rabbi as
this will vary depending on the circumstances. Note that alimony received
(line 11) is always liable for maaser, even if the payer of
the alimony has already taken maaser from his or her income before
paying alimony. What about child support?
- Certain taxes are deductible from your maaser income; others are not.
Income taxes are completely
deductible. This includes form 1040 lines 62 and
Schedule A line
5 (unless you check box 5b).
Other taxes and insurance payments
that are obligatory and either are taken as a flat payment or are computed
based on your income are deductible. Thus required unemployment insurance
(state unemployment insurance) is deductible, as are medicare, social
security, or FICA withholding. Note that, conversely, income received from
medicare, social security, or unemployment insurance is considered
maaser income. Thus you can deduct the amounts shown on your W-2 lines 4 and 6.
For more on unemployment insurance, see "Are
unemployment insurance payments subject to maaser?"
- Sales tax is not deductible — it's part of the cost of the item.
Real Estate taxes are not deductible. These are not only part of normal
household expenses, they are also a "fee for service" — in exchange
for these taxes, the municipality picks up your garbage, maintains the
streets, provides police, provides lighting on public roads, maintains
This means that you may deduct any amount shown
on form 1040
line 10 that is due to a refund of tax money on which you already paid
maaser such as a real estate tax rebate.
Privately-held life insurance, disability insurance, health insurance,
homeowner's insurance, car insurance and other insurance premiums are not
Most tax deductions are not deductible maaser expenses. Among other
things, your standard deduction, exemptions, and most expenses not
mentioned herein are not deductible.
You may deduct normal depreciation and amortization
expenses for anything you hold and use for business purposes as per the
normal custom were such property to be held for business in your tax
jurisdiction. Note that this generally does not apply to your car as you
deduct your mileage instead, and that includes a depreciation and
amortization allowance already. But if you purchased a computer for
business use, you could depreciate it for maaser purposes even if the
depreciation is not deductible for tax purposes. (But make sure to add back
in any personal use of the computer.)
Deduct your maaser deductions from your gross maaser income to
compute your net maaser income.
Finally, there are a few additional special accounting
considerations to cover:
For maaser purposes, you may deduct carry-over losses but only to the
degree that they offset comparable carry-over income. Thus if you have a
carry-over capital loss because your total capital losses exceed your gains
in a given year, you can't carry that loss forward for maaser
purposes. Instead, take it as a maaser deduction in the year
If you have no income but instead lose money one year, you cannot carry that
loss forward against maaser income in coming years.
There are no carry-back losses or profits; include both of these in the year
earned rather than the year accrued for tax purposes.
With regard to your Schedule C or E, there is no need to add back expenses
that would have been excluded if listed on your Schedule A. These expenses
are part of the business transacted on the Schedule C or E and are thus
directly deductible there. However, if this results in a net Schedule C or E
loss, this loss cannot be deducted from ordinary maaser income.
That's it, you've computed your net maaser income.
Having done so, you can now compute your maaser obligation for the year
as between one-tenth and one-fifth of this amount. Next, determine how much of
your obligation is still owed by computing how much of your charitable
contributions over the period qualify as maaser. To compute this
Start with your charitable contributions as reported on Schedule A line 18,
but reduce it by any amount on line 17 (as this amount would have been
deducted from your maaser obligation in the year given). There are
no carry-over or carry-back maaser contributions.
Deduct any IRS-accepted charitable contributions that are not considered
maaser. What is considered maaser?
In general, the basic maaser obligation is to support the poor
and only contributions for this purpose are included, but some other
tzedakah is included as well.
Gifts in support of the performance of a mitzvah by another
person are considered maaser, but not money spent for your own
performance of a mitzvah. For example, if you buy a lulav
and etrog for someone who would not have had one, whether that
person wouldn't have one due to financial or spiritual poverty, that
gift is a gift of maaser. If you buy one for your friend, that
likely isn't unless your friend can't afford one.
Support of a Torah scholar is maaser, as is an Issachar-Zevulun
Your synagogue membership dues are not maaser, but additional
contributions to the synagogue might be. For example, if you make a
contribution to subsidize the memberships of those who can't afford to
join the synagogue, that is certainly maaser. Financial support
of the rabbi and other synagogue staff is maaser. Additional
contributions that support classes, speakers, and Torah education may
also be maaser.
Extra contributions made to the synagogue in exchange for intangible
religious benefits such as an aliyah to the Torah are
maaser subject to the same conditions as other contributions
above the basic dues level. The fact that you receive the benefit of the
aliyah does not detract from the contribution.
The payment of wedding expenses (hachnasat kallah) for a poor
bride is maaser just like any other gift to the poor.
The payment of yeshivah tuition and related expenses is
maaser if paid for a child who would not otherwise have the
opportunity to have a Torah education. It is not maaser if paid
for your own child unless you could not afford the education without the
use of your maaser money.
The purchase of seforim (religious books) that are used for study
may be considered maaser. This is certainly the case if the books
are contributed to the synagogue library. If the books are for personal
use, the purchase may still be maaser, but only if either (1) you
could not otherwise afford the purchase or (2) you make the books
available for general use by lending them out to others.
Note that the IRS will permit you to estimate charitable contributions under
certain circumstances. For instance, if you put spare change or even dollar
bills into the tzedakah box at synagogue, the IRS will allow you to
estimate the annual total even if that total estimate comes to a number that
would normally require you to have a receipt (over $50 I think). However,
for maaser purposes, estimation is not appropriate. The Chofetz
Chaim observes that failing to record small amounts could cause a person
to contribute less than his obligation. For instance, perhaps at year end
you find that you are $400 short of your maaser obligation. If you
have no record, you may assume that you have given this over time, but
perhaps you only gave $200 or $300. Even if you gave $399, you would not
have fulfilled your obligation. Being only $1 shy of fulfilling the
mitzvah is still short of fulfilling the mitzvah. The
Chofetz Chaim notes that if you are accurate for your own benefit
— so that you don't lose credit for the money you have given away
— your accuracy also benefits those in need of those few extra
dollars. (See Sefer Ahavat Chesed, Part II, Chapter 28.) At the end
of each day, I record these few dollars of tzedakah in my calendar so
that I can total it at year end.
Once you have added up your maaser given, subtract this from your
maaser obligation and the remaining figure gives your remaining
obligation. Contribute this amount to an appropriate maaser recipient —
either a person, fund, or institution — immediately. Note that this amount
counts as maaser toward the accounting period in question, not the
accounting period you are currently in. Thus when computing your 1040 in April
of this year, if you find that you are $1000 short of maaser for last
year, remember not to count that $1000 contribution when you compute
maaser contributions made this year. Doing so would double-count the
$1000 as maaser in both of the two years in question.
Finally, note that some authorities prefer that maaser be computed
every three or six months rather than annually. Also note that even those who
hold that maaser can be computed annually agree that a Jew must
constantly tithe his income by working toward an estimated maaser
obligation. At year-end, he must make up for any shortfall. A good way to do
this is to constantly tithe your paychecks at a 10% rate, then compute your
precise obligation at year-end; I do this after preparing my federal tax return.
At that time, I can make up for any obligation not fulfilled. If it turns out I
have given more than was necessary, haray zeh meshubach!
This page is written based on the piskei halacha of Rav Moshe Feinstein
ZTz"L, Rav Shlomo Zalman Auerbach ZTz"L, the Chofetz Chaim, and others, as
brought in sefer Maaser
Kesafim, edited by Cyril Domb, published by Feldheim Publishers. Please
consult with your rabbi before acting on this information.
See also Ma'aseir
Kesofim by Rav Yosef Fleischman.
1Aruch HaShulchan Y.D. 249:7 allows deduction
of the full cost of the meal, but Beit Dino Shel Shlomo (Y.D. 1) and Rav
Shlomo Zalman Auerbach disagree. See discussion in Maaser Kesafim pp.
2Rav Moshe Feinstein says to use only vital
commodities like essential foods in computing the change in cost of living.
Houses and luxury items are not relevant since their values change for a variety
of reasons. Igros Moshe, Y.D. Vol. 5, 114 as brought in Maaser Kesafim
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