Save on Your Taxes with Year-End Charitable Giving
There are countless ways that you can increase your deductions at the end of a tax year, but few of these have a more positive impact than year-end charitable giving. Not only can you claim these gifts as deductions, you also have the opportunity to help others with your effort. This is an excellent way to give your tax return a boost in the last hour. That’s what we call a win-win!
If you are considering some charitable giving this year, keep these important things in mind to be sure that when it comes tax time, you can also benefit from your giving!
1. You must donate to a qualified charity:
In order to get that deduction you are looking for, you need to make sure that the charitable organization you are giving to is one that the IRS recognizes as legitimate. You can check on this by looking on the IRS website. Keep in mind that many religious organizations might not be on that list but still count as a qualified charity.
2. Keep solid records:
As with all things tax related, one of the most important things you can do is keep good records, in the event of a question from the IRS or an audit. Ideally, keeping an actual receipt from the charitable organization is best.
You must itemize your return to get the benefit of your year-end donations. If you claim the standard deduction amount on your return, you will not be able to get the deduction benefit.
4. Type of donation:
You may wonder what kind of items qualify as a charitable gift. You can deduct the following:
● Monetary donation (cash, check, gift card, or via credit card)
● Personal items in good condition (including household items, clothing, or other items with value)
5. Deadline to make donation:
You have all the way up to December 31st to make a donation that you can deduct on that year’s tax return. If you are giving a monetary donation by mail, you must mail it by the last day of the year. When you are cutting it close, it’s always a good idea to keep any back-up documentation verifying that you made the donation by the end of the year. Keep in mind that the donation does not have to be received by the charitable organization by 12/31 – it just needs to be out of your hands by that date!
So, as you plan for the upcoming tax year, remember that anything that you give to a charity can be deducted as long as you itemize your return. As you plan for the year, it might be helpful to partner with a firm who can help you strategize about the best ways for you to maximize your deductions and save as much as you can on your return this year. Success Tax Relief has been serving clients all over the country and saving them time, money and lots and lots of headaches. Contact us today to talk to one of our experienced tax professionals!