You are able to deduct the fair market value of the merchandise being donated to the charity.

If large dollars were in question, which usually is not the case, a modified answer could occur.

You see, the IRS would argue that the magazine only has a fair market value of $30 (???) because you are paying $30 for the points which are not given to the charity. Also, whenever a subscription is purchased, points are provided so value would be associated with that incentive. (The $30 number is just a reasonable number for my example.)

Remember, the larger the dollars involved, the more likely your position will be challenged. When challenged, most of you will fold under pressure from the auditor because you are uncomfortable with your actions and intimidated by the gov't.

Generally, it is a bad idea to make financial decisions based on tax reasons alone.