Maaser on Gross or Net? Taxes, Business Expenses, and What You May Deduct

"Ten percent of my paycheck" sounds simple until you ask: before or after taxes? Before or after the babysitter you only hire because you work? The poskim treat maaser like a business partner would — profit, not revenue.

Business expenses come off first. The Aruch Hashulchan (Yoreh Deah 249:7) rules that one calculates maaser on profit after legitimate business costs: wages paid to employees, inventory, leasing, advertising, business travel. Business losses from theft or breakage (absent negligence) also reduce the maaser base, and within an accounting period, losses offset gains (OU Halacha Yomis, "Pre-Maaser Deductions").

Income tax is deductible from the maaser base. Rav Moshe Feinstein (Igros Moshe, Yoreh Deah 1:143) rules that income tax, Social Security and similar amounts taken from your income by government mandate are not "income" to you at all — you tithe on what actually reaches you. (Note: the OU's published summary misprints the citation as 1:43; the teshuvah is 1:143.)

Sales tax and the property tax on your home are NOT deductible — those are living expenses on things you bought, not reductions of income. Rav Moshe distinguishes them explicitly from taxes on income or on investment property, which are business-related and deductible (Bais HaVaad, "Is Ma'aser Given From Gross or Net Income?").

Work-enabling costs. Several poskim permit deducting childcare or household help you would not need if you were not working — a cost of producing the income (OU ibid.).

Pick an accounting period and settle. The Chofetz Chaim (Ahavas Chesed II:18) describes keeping a written ledger and reconciling on a fixed cycle — classically Rosh Hashanah to Rosh Hashanah. Decide your period in advance and square the account at its end.

Run your real numbers through these rules and the result is rarely "ten percent of the paycheck." Sometimes you owe less than you assumed; sometimes more. Either way, you'll know — with sources.

MyMaaser presents sourced halachic positions and is not a substitute for your rav. Consult your rav (CYLOR).

Sources: Aruch Hashulchan YD 249:7 · Igros Moshe YD 1:143 via OU Halacha Yomis and AskTheRav · Bais HaVaad · Ahavas Chesed II:18 (Sefaria)