What Are You Giving To Charities This Holiday Season?
TIS the season of giving and as we near year end, we think of giving gifts not only to those we love, but also to our favorite charities. You itemize deductions and you want to use the donations to reduce your income tax. But IS that donation deductible?
Are you aware that only donations to Eligible Organizations are Tax-Deductible? We all recognize well-known charities like the Red Cross, American Heart, American Cancer, etc. But, what about the donation you made on Go Fund Me? Is that an eligible charity?
The IRS has a searchable online database tool on IRS.gov that lists most eligible charitable organizations. Before just assuming the charity is eligible, check out the list. You don’t want to list a donation and have it rejected by the IRS.
When making donations, get proof of monetary donations. A bank record or a written statement from the charity is needed to prove the amount and date of any donation of money. Money donations can include various forms apart from cash such as check, electronic funds transfer, credit card and payroll deductions. Taxpayers using payroll deductions should retain a pay stub, a Form W-2 wage statement or other proof showing the total amount withheld for charity, along with the pledge card showing the name of the charity.
If you have donated property, the deduction amount is normally limited to the item’s current fair market value. If the value is over $500, an appraisal of the asset to determine the value is required.
Help support a favorite charity while getting a tax deduction. Both you and the charity benefit.
Connect with Capehart Scatchard