Thanks,
Blair

The intent of the article is to point out planning opportunities with respect to donations already made. The issue for combining individual donations over $200 is to ensure the credit is fully used.

Combining donations doesn’t become more beneficial when each spouse contributes less than $200 – as soon as the total is over $200, combining is beneficial. Regardless of how large the individuals’ donations are.

Let’s play with numbers. Suppose I contribute $150 and my wife contributes $150. Then I get a 15% credit, and so does my wife, for $22.50 + $22.50 = $45.

If we combine, then I will claim $300, so I get a 15% credit on $200, and 29% on the remaining $100 ($300 – $200 = $100). So I get a credit of $30 + $29 = $59. That’s an extra $14. Very exciting.

Now suppose we were each contributing $250. If we claim separately, we each get 15% of $200 and 29% of $50, for a total of $30 + $30 + $14.50 + $14.50 = $89.

If we combine our donations, then I claim $500. I get 15% on the first $200 and 29% on the next $300. That’s $30 + $87 = $117. That’s $28 extra. Yay.

In the first case, by combining we moved only $100 from the 15% bracket to the 29% bracket so we received an extra (29 – 15 = 14)% credit on that $100, for a gain of $14.

In the second case, by combining we moved a full $200 from the 15% bracket to the 29% bracket, so we got 14% extra credit on the $200, for a gain of $28. Of course, this is the maximum gain to be realized by combining donations.

My point is that as soon as a couple’s donations exceed $200, it’s worthwhile combining them. But the benefit doesn’t decrease once each partner exceeds the $200 mark, as your article suggested – the benefit increases until each partner is contributing at least $200, and then levels off, to top out at $28.

It seems to be just as beneficial when individual donations exceed $200.
Really, it seems to be more beneficial, as then a full $200 is being credited at the higher rate, rather than the less-than-$200 that would be credited at the higher rate when individual donations are less than $200.