People who give to charity do so freely, without a tinge of "what's in it for me". But even the most earnest philanthropists will agree that a tax break can make the good feeling you get from giving, even better. It's easy to realize a tax break from your charitable donations. Keep track of the money you give throughout the year, and use an IRS Form 1040, Schedule A. With this document, you can let the tax agency know about your generous contributions, and you will be rewarded with a legitimate charitable tax deduction. Like all things in life, charities can be good or bad. Most are worthy, legitimate organizations that rely on the donations of generous individuals. On the other hand, some "charities" are no more than crooks who are happy to take your cash and run. That's why it's so important to do your homework before making your donation. Ask for the group's charitable organization number. It's also a good idea to pick up a copy of the IRS Publication 78. This guide is available online and at most public libraries and provides a complete list of all charitable organizations that are recognized by tax agencies. Not all charitable donations are tax deductible. For example, donations made to political organizations, political leaders or individuals will not realize a tax break. And, even though time is money, you cannot claim a deduction for the time that you spend holding raffles or raising money at bingo or casino games. You don't necessarily have to give cash to get a tax break. Deductions may be available for contributions of merchandise, goods or services. The amount of the tax break is based on the market value of the merchandise, goods or services donated. In other words, if your business donates a product valued at $200 to a local charity, you can claim a $200 tax deduction, provided that it is a charitable organization recognized by the tax agency. It's also possible to receive a tax deduction for your donation of company stocks. The value of the stocks is based on the average high and low values on the date of valuation of the gifted stocks. You may also receive a tax break by donating a vehicle. The amount of the deduction will be based on the vehicle's resale value at the time of donation. This is also true of planes and boats donated to charity. However, if the claimed value of the donated boat, plane or motor vehicle exceeds $500, and the item is sold by the charitable organization, the tax break is limited to the gross proceeds from the sale. If you are donating a household or personal item, a deduction can be claimed on the amount that the item would have fetched at a garage sale or at a flea shop. To qualify for a tax deduction, a proper receipt is required for all charitable contributions over $250. Be sure to claim your tax deduction in the same year that you make your donation. It doesn't matter if you have a check or credit card statement that proves your donation. If it's from a previous year, you won't be able to claim the donation. These amounts cannot be carried over to a new tax year. Even if you don't expect to get anything in return for your goodwill, go ahead and keep a list of your charitable donations. The taxman will appreciate and reward your generosity.
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People who give to charity do so freely, without a tinge of "what's in it for me". But even the most earnest philanthropists will agree that a tax break can make the good feeling you get from giving, even better.
Author Angelina Pyrkins loves writing for a variety of Internet magazines, on family lawyer and family life issues. Get a unique version of this article from our charitable donation article directory
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