What is the ‘Benefits Received Rule’
The Benefits Received Rule actually has two related definitions, one as a tax theory and one as a tax provision. The two definitions are:
1. The Benefits Received Principle, which is a theory of income tax fairness that says people should pay taxes based on the benefits they receive from the government.
2. A tax provision that says a donor who receives a tangible benefit from making a charitable contribution must subtract the value of that benefit from the amount claimed as an income tax deduction.