When someone takes it upon themselves to help another in need, that deserves a reward. For many people, they don’t realize that many things that they do out of the kindness of their hearts can actually benefit them when tax time rolls around. It can be a little tricky, though, when it comes to figuring out how much you can claim as a charitable donation.
What Counts as a Charitable Donation?
According to the IRS Publication 78, “You may deduct charitable contributions of money or property made to qualified organizations if you itemize your deductions.” There are several stipulations for claiming and itemizing our donations:
You must make an actual donation
Your donation must be to a qualified tax-exempt organization
You must be able to itemize your giving
You must keep record of your giving
How Much to Deduct in Donations
Having someone on your side to help you figure out what can be claimed and what cannot be is essential as you try to figure out tax deductible donations. You want to make sure that you get all of the credit you deserve for your giving. Donating significant amounts of money or good to different causes can be a very smart budgeting move, as tax deductible donations can lower your taxable income.
When donating goods or services and not just giving money, it becomes very important to keep the proper documentation and records of what you’re giving. A few things to consider when donating items:
Keep a list of what you’ve given
Everything, from food to clothing to small appliances, counts
Get a written receipt of what you’re giving
Get an appraisal of what you’re donating if it’s over $5,000
There are a lot of stipulations, guidelines and suggestions when it comes to deducting your charitable giving. For more information, you can check out the IRS publications. There are several sources that can give you tips in the right direction.
Believe and Achieve with TSLNH
At Tax Services of Londonderry, we have set up a campaign called Believe and Achieve to help women reach for their full potential and have the clothes to “dress for the job they want, not for the job they have.” Your kindness and support will help this clothing drive be a success, and all donations are tax deductible. But nothing compares to the benefit of knowing that your generosity is empowering women to create the life they want!
To find out more about how your donations of professional clothing or money will be used, check out our Facebook page for details.
As always, TSLNH is always here to help guide you through all of your tax questions. Whether it’s about charitable giving, donations, or how to best use your taxable income, we’re here to help. Contact us today and find out how we can be of service to you!