To economists, the tax deduction for charitable contributions is equivalent to a government grant matching private donations that increases with income.

So when the top tax rate increased to 39.6 percent from 35 percent, as it did last week, so did the power of the charitable deduction. For taxpayers in the new top bracket, the after-tax cost of contributions dropped by 7 percent, according to the nonpartisan Tax Policy Center in Washington.

That will encourage people to donate money to nonprofits rather than pay it in taxes.

Combined with other changes, the center estimates that the tax increases passed by Congress last week will increase charitable giving by 1.3 percent, or $3.3 billion.

Original post is Tax Boosts: Charities to Benefit by Political Capital.

Photograph by Brendan Smialowski/AFP via Getty Images

President Barack Obama, Mitt Romney and others attend the 67th annual Al Smith dinner at the Waldorf Astoria hotel on Oct. 18, 2012 in New York.

“It’s nice to relax and wear what Ann and I wear around the house,” Republican Mitt Romney said at a white-tie dinner.

“We’re down to the final months of the president’s term,” Romney said, with President Barack Obama, also in tux and white-tie, seated  at the charity dinner and mutual roast in New York City. “You have to wonder what he’s thinking — so little time, so much to redistribute.”

Obama, Romney said, “already has a new campaign slogan — you’re already better off than you were four weeks ago.”

Romney joked about his presidential debate preparations — 65 years without alcohol, and find the best “straw man” possible. “Big Bird didn’t even see it coming,” he said.

The president, when his turn arrived, asked everyone to “please take their seats — otherwise Clint Eastwood will yell at them.”

In a few weeks, he said, voters in several swing states will decide this year’s election, “which begs the question, what are we doing here?”

`I had a lot more energy in our second debate,” Obama said of his first two televised debates with Romney. “I felt a lot more rested after the nice, long nap I had in our first debate.”

Obama said he had gone shopping in some stores in Midtown Manhattan today — “Governor Romney went shopping for some stores in Midtown.”

Noting that the nation’s unemployment rate is the lowest since he took office, the president said: “I don’t have a joke here. I just thought it would be useful to remind everybody that the unemployment rate is the lowest since I took office.”

Noting that “Mitt” is Romney’s middle name, Obama said: “I wish I could use my middle name.”

Obama and Romney were seated at the same head dinner table.

Who attends a dinner like this, the annual Alfred E. Smith dinner which every four years takes on a special character?

An annual charity affair for the benefit of poor children in the lair of the rich, the Waldorf-Astoria Hotel, which has become a must-stop along the presidential campaign trail?

Mary Higgins Clark, Henry Kissinger, ABC’s (formerly NBC’s and CBS’s) Katie Couric, MSNBC’s Chris Matthews, FOX’s Roger Ailes, CNBC’s Maria Bartiromo, U.S. World and News’ Mort Zuckerman, Washington’s Sen. Chuck Schumer, former New York Mayor Ed Koch and current New York Mayor Michael Bloomberg, among others tonight.

The event, organized by the Catholic Archdiocese of New York, raises money for impoverished children. By tradition, presidential candidates share the podium to tease their rivals and mock themselves. While in town, Obama also taped an appearance on “The Daily Show with Jon Stewart” set for broadcast tonight.

The host is Cardinal Timothy Dolan, leader of the New York archdiocese and president of the U.S. Conference of Catholic Bishops, which has battled with Obama over a contraception rule for church-run organizations. Romney, a former governor of Massachusetts, has opposed the contraception rule.

In an Aug. 14 posting on the archdiocese blog, Dolan wrote that he received “stacks of mail protesting the invitation to President Obama (and by the way, even some objecting to the invitation to Governor Romney).” Dolan wrote that the dinner is intended to be “an evening of friendship, civility, and patriotism, to help those in need, not to endorse either candidate,” and is keeping with the church’s promotion of dialogue.

Namesake and great-grandson Al Smith IV wasn’t letting anyone else run away with the humor tonight.

In his opening remarks, in acknowledgement of the women in the room — and with an allusion to Romney’s remark in the last presidential debate this week — he said: “It’s good to see who’s getting out of those binders.”

Smith, noting that his great-grandfather was the first Catholic nominee for president, pointed out that Romney is the first Mormon candidate for president. He noted, too, that they both campaigned for governor — “as Democrats.”

Smith added that Romney gives 10 percent of his income to charity — “but the charity is the federal government.”

“Really governor,” Smith asked, “your father was from Mexico and you have five kids — are you sure you’re not Catholic?”

Smith dished it out for the president, too.

“We recognize that you have some challenges this year,” Smith told Obama.“It’s never good when your opponent has produced more sons than you have jobs.”

Original post is Obama, Romney at Charity Dinner: `More Sons… Than Jobs’ by Political Capital.

Photograph by Scott Eells/Bloomberg

Mitt and Ann Romney during the RNC.

Updated with added details

Mitt and Ann Romney paid $1,935,708 in taxes last year on $13,696,951 in mostly investment income, according to a report from their accountants released by the campaign today.

The Romneys’ effective tax rate for 2011 was 14.1 percent, the accountants said.

The couple donated $4 million to charity, they reported, amounting to nearly 30 percent of their income, and claimed a tax deduction of $2.25 million as a result. They are said to have restrained their deduction for charitable giving to keep their tax rate above 13 percent.

This was the second of two promised releases.

Romney had earlier disclosed his 2010 tax return, which showed an effective tax rate of 13.9 percent paid on $21 million of investment income. Refusing to release more than the 2010 and 2011 returns, Romney also has said that he has examined the last 10 years of his returns and found that he never paid less than 13 percent in taxes.

The typical American household paid 17.4 percent in taxes in 2009, including federal and other levies.

“The Romneys’ generous charitable donations in 2011 would have significantly reduced their tax obligations for the year,” Brad Malt, the trustee of Romney’s blind trust, wrote in a campaign blog posting. “The Romneys thus limited their deduction of charitable contributions to conform to the governor’s statement in August…  that he paid at least 13 percent in income taxes in each of the last 10 years.”

Over a 20-year period, Malt reported today, the Romneys’ annual tax rate averaged 20.2 percent, and over those two decades they have never paid less than 13.66 percent, and they have given, on average, 13.45 percent of their adjusted income to charity,

President Barack Obama paid 20.5 percent in federal taxes on $789,674 in adjusted gross income for 2011, he reported earlier this year. The Obama campaign has been pressing Romney to release more returns, saying it would settle for five years of reports.

U.S. Rep. Paul Ryan of Wisconsin, Romney’s choice for vice president, on Aug. 17 released information showing he paid a 20 percent effective tax rate on his 2011 income.

Original post is Romney’s 2011 Taxes: 14.1 Pct by Political Capital.