Maaser kesafim (tithing on money) is one of those Jewish practices that sounds simple until you sit down with a brokerage statement. "Give 10% of your income to charity" is clear. What counts as income when your money is invested? Do you tithe on unrealized gains? What about dividends you're reinvesting? What about losses? Let me walk through the practical math.

Where Maaser Kesafim Comes From

Maaser on money isn't in the Torah the way maaser on produce is. The biblical tithe, discussed in Leviticus 27:30-33 and Deuteronomy 14:22-29, applies specifically to agricultural produce grown in the Land of Israel. The text says, "All the tithe of the land, whether of the seed of the land, or of the fruit of the tree, is the Lord's; it is holy unto the Lord."

Maaser kesafim, tithing on money, is a later rabbinic extension. The Talmud in Taanit 9a discusses the principle that one who tithes will become wealthy, quoting Deuteronomy 14:22 ("aser ta'aser," "you shall surely tithe"), which the Talmud reads as a wordplay: "tithe so that you may become wealthy." The Shulchan Arukh Yoreh Deah 249:1 rules that the minimum level of charitable giving is one-third of a shekel per year, but the preferred level is a tenth of one's earnings. The Rama (Ashkenazi gloss) adds that the tenth level is considered a middah benonit, the medium standard, with one-fifth being the generous standard.

Practically speaking, modern Orthodox communities treat maaser as a minimum standard of charitable giving for those who can afford it. It's not a strict biblical obligation like the agricultural maaser, but it's a strongly-held community norm.

What Counts as Income for Maaser Purposes?

This is where it gets interesting. The Shulchan Arukh doesn't give a detailed accounting treatment for maaser kesafim because stocks and brokerage accounts didn't exist when it was written. The modern poskim have had to extend the principles to new circumstances.

The three main approaches to "what counts as income" are:

Approach 1: Cash received. Under this view, you only tithe on money that actually hits your pocket. Dividends received are taxable for maaser. Capital gains are not until you sell and receive cash. Unrealized gains in your portfolio are not counted. This is the most common approach among American Orthodox families and is favored by Rabbi Yitzchok Zilberstein, Rabbi Moshe Feinstein's students, and others.

Approach 2: Realized gains. Under this view, dividends count (same as cash received approach), and you also tithe on capital gains when you sell a stock at a profit, whether or not you take the cash out. So selling Apple stock at a $5,000 gain triggers $500 of maaser obligation even if you immediately reinvest the proceeds into Microsoft.

Approach 3: Net worth growth. The most expansive approach, favored by some Sephardic authorities including Rabbi Ben Zion Abba Shaul, treats any increase in net worth as income for maaser purposes. This means you'd tithe on unrealized gains too. If your portfolio went from $100,000 to $110,000 during the year, you'd owe $1,000 in maaser regardless of whether you sold anything.

Most American Orthodox advisors follow Approach 1 or 2. Approach 3 is mathematically intense and creates liquidity problems in volatile markets (do you owe maaser on last year's gains even if this year you're down?). Rabbi Moshe Feinstein's position, as preserved by his students, generally aligned with Approach 2: tithe on realized gains.

The Math: A Real Example

Let me walk through a practical example. Say you're a 40-year-old Orthodox investor with a taxable brokerage account. At the start of 2025, your portfolio was worth $200,000. Let me give you a year of activity:

You contributed $12,000 in fresh money over the course of the year
Dividends received: $4,200 (cash paid into the account)
You sold 50 shares of Apple (AAPL) you'd held for 3 years. Original cost basis was $7,000. Sale price was $12,000. Realized gain: $5,000.
You sold 100 shares of Nvidia (NVDA) you'd held for 6 months. Original cost basis was $12,000. Sale price was $18,000. Realized gain: $6,000.
You sold 200 shares of Intel (INTC) at a loss. Original cost basis was $8,000. Sale price was $5,000. Realized loss: -$3,000.
You reinvested everything back into the portfolio (Apple, Nvidia, Intel proceeds all went back in).
End of year portfolio value: $240,000.

Let me calculate maaser under each approach.

Approach 1 (Cash received): Only dividends count. You received $4,200 in dividends. Maaser owed: $420.

Approach 2 (Realized gains): Dividends plus net realized capital gains. Net realized gains = $5,000 + $6,000 - $3,000 = $8,000. Plus dividends = $4,200. Total income for maaser: $12,200. Maaser owed: $1,220.

Approach 3 (Net worth growth): End value - beginning value - contributions = $240,000 - $200,000 - $12,000 = $28,000. Maaser owed: $2,800.

You can see how the number triples between Approach 1 and Approach 3. This isn't a small difference. Picking an approach has real implications for your charitable budget.

Can You Offset Losses Against Other Income?

Under Approach 2, the conventional ruling is yes. You can offset realized capital losses against realized capital gains within the same year. You cannot offset investment losses against salary income for maaser purposes because salary is a different category of income.

The Chazon Ish discussed the general principle that maaser is calculated on net profit, not gross receipts. If a business has expenses, you tithe on the net profit after expenses, not on the gross revenue. Investment losses function similarly to business expenses: they reduce the profit calculation.

If your year's net realized gains are negative (losses exceed gains), you do not owe maaser on investment income for that year. You still owe maaser on dividends received (since those are separate cash receipts), unless your rabbi holds the position that the dividends can be reduced by the losses.

Retirement Accounts: 401(k)s and IRAs

Here's where it gets especially tricky. Retirement accounts are tax-deferred, which means the government doesn't treat growth as income until you withdraw. Does maaser follow the tax treatment?

The prevailing view among modern Orthodox advisors is that maaser on retirement account growth is owed when you withdraw the money, not when the growth occurs within the account. This aligns with the cash-received principle and with how tax treatment works.

So if you're 35 and your 401(k) grew by $50,000 this year, you do not owe $5,000 in maaser immediately. You'll owe maaser on the amounts you withdraw during retirement, at whatever pace you withdraw them.

For Roth accounts (Roth IRA, Roth 401(k)), the contribution was after-tax money that you may have already tithed on. The growth within the Roth is subject to maaser upon withdrawal according to most poskim, unless you take the position that Roth contributions "pre-paid" the maaser on everything they'll earn. The more conservative (stricter) position is to tithe on withdrawals, which is what most Orthodox advisors recommend.

Contributions you make into a 401(k) from pre-tax payroll are typically not tithed immediately because the money hasn't been received by you yet. It went directly from employer to account. When you eventually withdraw, you tithe at that point.

This creates an asymmetry: money flowing out of a retirement account into your checking triggers maaser, money flowing within the account does not. This is manageable but requires record-keeping discipline to track what's been tithed.

Real Estate and Rental Income

For investors who own rental properties or REITs, the maaser calculation is similar to business income. You tithe on net rental income (gross rent minus expenses, taxes, maintenance, mortgage interest, and depreciation). For REITs held in a brokerage account, the distributions you receive are the income. REIT capital gains on sale follow the same rules as stock capital gains.

REITs have a quirk: their distributions often include a return of capital component, which is technically not income but a repayment of principal. For maaser purposes, return of capital is not taxable income because it's just your money coming back to you. A careful tithe calculation would separate the ordinary dividend portion from the return of capital portion. Most brokerage 1099-DIV forms break this out, so you can see it.

Interest Income

Interest on bonds, savings accounts, CDs, and money market funds is cash received and is subject to maaser. The calculation is simple: all interest is income for maaser purposes.

For Israel Bonds, the interest is subject to maaser just like any other bond interest. Some Orthodox investors consider their Israel Bond purchases as an additional form of charitable giving in their own right, but this doesn't offset the maaser obligation on the interest received.

When Is Maaser Actually Due?

There are two practical approaches to timing.

Annual calculation: Some families do a full maaser accounting once a year, typically around Rosh Hashana or the civil year end. You calculate all income received during the year, subtract losses and necessary expenses, and then ensure you've given at least 10% of the net to tzedakah. If you've under-given, you make up the difference. If you've over-given, you bank the excess against future obligations.

Running calculation: Other families calculate as they go. Every time they receive income, they move 10% to a tzedakah account or give it immediately. This is more administratively intense but keeps things current.

For investors with regular dividend income, the running approach is cleaner because dividends hit the account monthly or quarterly. You can set up automatic transfers of 10% of dividend payments to a donor-advised fund or charity account.

Donor-Advised Funds

A donor-advised fund (DAF) is a useful tool for maaser management. You contribute to the DAF, receive the tax deduction immediately, and can then distribute to charities over time. For Orthodox investors, this allows you to separate the maaser payment from the charitable grant-making process.

Popular DAFs include Fidelity Charitable, Schwab Charitable, and Vanguard Charitable. For Jewish-specific options, the Orthodox Union Foundation and the Jewish Communal Fund offer DAFs that are oriented toward Jewish charitable giving.

One caveat: contributing to a DAF fulfills the maaser obligation if you consider the contribution itself as the tzedakah. Some authorities hold that the mitzvah of tzedakah requires actual distribution to the needy, in which case contributing to a DAF without granting out is incomplete. Consult your rabbi on this one.

Maaser Isn't a Tax

One last point worth making. Maaser kesafim is not a tax. It's a mitzvah. The mindset matters. The Shulchan Arukh Yoreh Deah 249:3 talks about how charity should be given with a pleasant face, not reluctantly. The Talmud in Bava Batra 9b-10a discusses the enormous spiritual value of tzedakah, calling it equivalent in weight to all other mitzvot combined.

Calculating maaser carefully is good. Doing the math precisely is good. But the calculation exists to serve the mitzvah, not to reduce it. If the precise accounting makes you resent the obligation, you've missed the point. The accounting framework is a tool for ensuring you give at least the minimum. The actual mitzvah is the giving itself.

Quick Reference Table

For a typical Orthodox investor with a taxable brokerage account, here's a quick summary:

Dividends received: tithe at 10% in the year received
Interest received: tithe at 10% in the year received
Realized capital gains: tithe at 10% of net realized gains in the year realized
Realized capital losses: offset against realized gains before tithing
Unrealized gains: typically not tithed until realization (except under Approach 3)
401(k) / Traditional IRA growth: tithe when withdrawn
Roth growth: tithe when withdrawn (conservative view)
Rental income: tithe on net rental income
REIT distributions: tithe on ordinary dividend portion, not return of capital
Fresh cash contributions to account: not income (already your money)

The most important thing: pick an approach with your rabbi, document it, and apply it consistently year after year. The mitzvah lives in the consistency more than in the specific threshold you choose.

Maaser (Tithing) on Investment Returns: The Practical Math