Charitable Donations: What to Know
Each year as Dec. 31 draws near, Americans are bombarded by requests for donations. Many answer those solicitations, happily giving to their favorite charities.
This year-end generosity also might pay off at tax time, as long as you know and follow the IRS' rules on tax deductions for donations.
Itemizing required
You can give thousands of dollars, but if you claim the standard deduction amount on your tax return, your charitable gifts will do you no tax good. You must itemize expenses on Schedule A to deduct charitable donations.
The good thing about donations is that, in most cases, there is no limit on how much you can deduct.
Timing is everything
Donations must be made by the end of the tax year for which you want to claim the deduction. If you put a check dated Dec. 31 in the mail by that day, you're OK. So are donations charged by year's end to your credit card, even if you don't pay the card's bill until the next year.
Check out the charity
Only contributions to IRS-qualified charities are deductible. This means the group meets Uncle Sam's requirements to be classified as a tax-exempt organization. You've probably heard this referred to as 501(c)(3) status, so-called because that is the section of the Internal Revenue Code that governs such groups.
Ask the charity to which you plan to give for information on its tax status. Reputable nonprofits will be more than happy to offer proof.
You also can check out groups via various online databases, such as GuideStar and Charity Navigator, as well as by using the IRS' own online searchable database of exempt organizations.
Take advantage of these tax benefits by making an end of year donation to the Arizona Spinal Cord Injury Association! All proceeds will benefit quality of life programs. Contact us for more information.
Read more: http://www.bankrate.com/finance/taxes/get-a-tax-deduction-for-charitable-giving-1.aspx#ixzz4RcHC4Vw6
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