Charity Begins at Home Part 2
What factors determine if your donation is tax deductible or not: For a charitable donation to be tax deductible, one has to keep in mind first and foremost that one has to itemize deductions on the tax return via Schedule A and,
- That the donation is to a qualified organization. A qualified organization is an
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- These organizations include non-profit groups that are religious, charitable, educational, scientific, or literary in purpose, or that work to prevent cruelty to animals or children. (For an exhaustive list refer Pub 526)
- One can check for an organization's status with the Internal Revenue Service on this website. If there is ever a doubt in your mind as to whether an organization's tax exempt status is true, whether you want a tax deduction or not, this website would be a good starting point.
- You can also check with the Better Business Bureau for their accredited charities.
- If you received a gift or any other benefit in exchange for your donation, it is deductible only to the extent it's value exceeds that of the gift/ benefit received.
- If you make contributions to needy individuals, your donation is NOT tax deductible.
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- The VALUE of your volunteer time is NOT deductible, however out-of-pocket expenses directly related to such volunteer work & miles driven to & from volunteering is tax deductible.
- Donated goods may be deducted at their fair market value at the time of
- In addition to the above if your cash donations exceed $250, you require a written acknowledgement from the charity. Bank records and written communication from the charity are also acceptable forms of records for donations less than $250.
As always, read my disclaimer here. Please consult a qualified tax professional for your unique tax needs. More of my contact information is on my website, www.mntaxsolutionsllc.com.