The Lord Giveth and the Lord Taketh Away
how do you guys tithe capital gains? do you not “have to” since it’s already “post-tithe” when you invested it? if you do tithe, is it net of losses? or do you tithe on all realized gains and eat any losses you may have? (this post unintentionally makes tithing sound like a God tax.)
I’ve wondered about this too. I’ve never had to deal with it because I’ve almost never realized any capital gains, other than some minor interest income off of cash.
There are all sorts of complexities of modern life that require Talmudian reasoning to sort through. Should one tithe in-kind benefits? Health insurance premiums paid by the employer? Benefits we receive from the government, including tax breaks? One can easily see why the Pharisees ended up going down the path they did.
More thoughts on tithing capital gains. Should you subtract out inflation? After all, gains that accrue just because the general price level has risen don’t make you wealthier.
In Biblical times, there was inflation, but its pace was glacial, since every nation was on the gold standard, so the expansion of the money supply was limited by how quickly new gold supplies were discovered and extracted. So these intellectual problems never came up.
If your house price has gone up a lot and you sell the house, but you keep on living in the same area, then the price of purchasing new housing has also gone up. So you’re not made better off by your house price appreciation; it’s just inflation that you’re almost perfectly hedged against by your former housing investment. So should housing capital gains be exempt from tithing? What if you’re moving from a high-housing-cost area to a low-housing-cost area? And if you’re going in the reverse direction, should you deduct an effective capital loss to adjust for the fact that your nominal income doesn’t buy as much in real terms?
and should the OT laws forbidding charging interest (at least to fellow Israelites) affect our understanding of the time value of money?
Most of the OT passages on interest have to do with lending to the needy, so they apply more to the act of charity than the time value of money.
“If you lend money to one of my people among you who is needy, do not be like a moneylender; charge him no interest.” (Exodus 22:25)
“If one of your countrymen becomes poor and is unable to support himself among you, help him as you would an alien or a temporary resident, so he can continue to live among you. Do not take interest of any kind [a] from him, but fear your God, so that your countryman may continue to live among you. You must not lend him money at interest or sell him food at a profit.” (Leviticus 25:35-37)
There is another verse where the prohibition is more far-reaching, but because the distinction is made between Israelite and foreigner, it suggests that it is a matter of ceremonial law rather than moral law, and hence no longer applicable under the new covenant.
“Do not charge your brother interest, whether on money or food or anything else that may earn interest. You may charge a foreigner interest, but not a brother Israelite, so that the LORD your God may bless you in everything you put your hand to in the land you are entering to possess.” (Deuteronomy 23:19-20)