Tithing: Should You Pay On Your Gross or Net Income?

Posted: February 19, 2019

Tithing is one of the most important commandments in the LDS church. It’s the only commandment we have to declare our compliance with once a year, and it’s required if you want a temple recommend.

There’s at least one story each month in the Ensign or New Era dedicated to the blessings of tithing. It’s simple, right? Donate 10% of your income to the church and you’ll get the blessings. As simple as 10% sounds, though, how much tithing you pay can actually get complex.

A little history on tithing

Tithing has been around for a long time. The first mention of it comes in Genesis 14, where Abram gave tithes to Melchizedek, the king of Salem.

Paying tithing is excellent fire insurance. We’ve also been promised that if we pay tithing, the blessings that come will be more than we can receive.

In the modern church, Joseph Smith received a revelation now known as Doctrine and Covenants section 119. In it, the Lord said:

Those who have thus been tithed shall pay one-tenth of all their interest annually; and this shall be a standing law unto them forever, for my holy priesthood.

Today, we view that revelation to mean 10% of your income. But the law wasn’t always interpreted that way. And I’m not talking about how people used to tithe with eggs or potatoes or pigs. Rather, how much tithing you paid was based on your net worth.

As you’ve probably noticed, the church has made a push recently to publish more about its history in context. As part of that effort, Steven C. Harper from the Church History Department wrote an article about tithing in the early days of the church.

Harper shares that after Edward Partridge heard the revelation in a Sunday reading, he wrote a letter to Newel K. Whitney. In it, he shared the law as applying to interest members would earn if they invested their net worth for a year:

“If a man is worth a $1000, the interest on that would be $60, and one/10. of the interest will be of course $6.” (6% was a common interest rate at the time)

Here’s another interesting article about the original intent of the revelation. It’s impossible to say when the church began to interpret the law of tithing as one-tenth of our income, but that is the current commandment.

Gross or net income?

Like I said before, 10% isn’t as simple as it sounds. When having the discussion about whether you should pay your tithing on gross or net income, it wouldn’t surprise me if you’ve heard the question: “Well, do you want gross or net blessings?”

This question is always rhetorical (who’s going to say they want net blessings?) and usually ends the conversation. I heard it for the first time shortly before my mission. I resolved then and there that I’d always qualify for gross blessings.

When we married, my wife said something about paying on net income, but I wouldn’t have it. Then, a couple years ago, my wife and I were in a bishop’s office going over our budget. We needed a little financial assistance from the ward and were happy to walk through our income and expenses with the bishop.

He first asked me what my take-home pay was. After I told him, he automatically calculated our tithing based on that amount. I was confused. Does my bishop pay on net? Didn’t he want gross blessings?!

The church’s stance on tithing

In fact, the church has no official stance on whether you should pay tithing on your gross or net income. This is the statement the First Presidency made in 1970. As of yet, nothing has superseded it:

“The simplest statement we know of is the statement of the Lord himself, namely, that the members of the Church should pay ‘one-tenth of all their interest annually,’ which is understood to mean income. No one is justified in making any other statement than this.

“Every member of the Church is entitled to make his own decision as to what he thinks he owes the Lord and to make payment accordingly.”

In other words, how you define your income for tithing purposes is between you and God. It’s not up to your bishop, your stake president or any of the general authorities to decide for you. Of course, some of these men may have opinions on how you should calculate your income. But they’re not justified in setting that number for anyone but themselves.

Keep it simple

Things can get really complicated if you spend too much time calculating your income. For example, what happens if you pay on gross income but die before you receive Social Security income and Medicare coverage. Was that Social Security and Medicare tax actually income?

And what if you don’t get a tax refund, should the federal and state income tax you paid the previous year be no longer be considered income? What about investment income that’s not yet realized because you haven’t withdrawn it from the account? If the stock market crashes the next year and you lose all those unrealized gains, were they really income in the first place?

OK, let’s take a deep breath before you and I pop a blood vessel thinking about all of this. When doing tithing settlement at the end of the year, the bishop won’t ask you for a W-2 form or tax return to verify your “full tithe” declaration. And that’s how it’s supposed to be. You don’t need to get all intense in determining what’s income and what isn’t. Simplicity is, after all, a principle of the Gospel. Do what you feel comfortable with.

And the next time someone shares the “gross or net blessings” argument, share this with them 😉

With the official statement of the church in mind, that kind of argument effectively seeks to take away a person’s agency. It makes them believe that they may be robbing God or will receive lesser blessings for paying on their net income. That’s just not true. However you decide to pay your tithing, do it prayerfully and honestly. That’s all God asks for.