Tax Tips for Gifting in 2017

 

Tax Tips for Gifting in 2017

by Amy Lignor

 

It may seem silly to be speaking about contributions, donations to charity, and holiday gifting when the temperature gauges in some areas of the U.S. are still reading three digits. However, as anyone can see when they go to retrieve their mail, more and more envelopes, newsletters, magazines and promotional material is being sent out by organizations requesting donations. From the beautiful 2018 calendars being sent from places like the National Parks Conservation Association; to the lovely Christmas card samples being sent by the National Wildlife Federation, more and more mail is headed to your house from truly great organizations needing help to continue their work.

Tax benefit, gifting, money, charitable contribution, deduction, qualified organizations,

Tax season may also seem a million years away. However, when it comes to these organizations asking you to contribute, tax season has to be taken into consideration. By giving money, not only will you be ‘saving’ something or someone, you will also (in most cases) be able to receive a tax benefit because of the charitable contribution you make.

 

But how do you know which donations qualify for a deduction? What are the pros and cons when it comes to distributing your money as contributions, and how do you know which are actually qualified organizations? This is information you need to know – even when the lazy days of summer have yet to fade away.

 

1) When wondering what defines a qualified organization, in general, all government, religious, and non-profit organizations qualify for charitable deduction purposes. Examples include: churches, money given to a federal, state or local government to be used for public purposes, a non-profit organization, a war veteran’s organization, a volunteer fire company, a civil defense organization and more. On the other hand, types of organizations that will never qualify for the charitable deduction include: sports clubs, labor unions, and donations to politicians, among others. (*see the IRS’s complete rules for the full details)

 

2) If you find that organization you truly wish to support, and make a donation, the rules when it comes to your tax deduction are straightforward. If you do not receive anything in return, you simply deduct the entire donation amount. If you do receive something in return for your donation, you can deduct the donation amount, minus the reasonable market value of whatever you received.

 

It’s important to note that there are a slew of major charities out there, big names that a great many millions of people donate to every year (i.e., The Salvation Army) that will provide you with a donation guide. It is also important to remember that there is an annual limit for charitable contributions which is no more than 50% of your adjusted gross income (AGI).

 

3) Last, but not least, the biggest thing when it comes to contributing money to an organization is making sure that the organization is definitely exactly what it claims to be. Make sure to follow a checklist when it comes to this. If you’re not sure whether donations to a particular charity are tax-deductible, make sure to confirm an organization’s tax-exempt status by checking with the group or by going straight to the IRS website.

 

When this is done, make sure to give directly to the charity you want to support, and not to a professional fundraiser who may contact you on the phone. In addition, request privacy in regards to your donation. You can and should tell all groups you’re supporting that you do not want your name and contact information to be sold, exchanged, or rented to other groups or for-profit companies, which can be a common practice among some charities. Always check a charity’s privacy policy before giving.

 

And, always understand that there are “sound-alikes” out there. What this means is that some charities have pronounced themselves with names that are almost duplicates of high-rated charities out there in the U.S. Groups may be just fine and only have similar names because they are focusing on the same cause as another charity; however, there are others that simply adopted an almost duplicate name in order to deceive donors.

 

To narrow things down, some top organizations to donate to when it comes to the environment or conservation causes (which is one of the largest industries that request donations), are; The Environmental Defense Fund, The Nature Conservancy, The Natural Resources Defense Council, The Sierra Club Foundation, as well as the Trust for Public Land. These are all great organizations with missions that focus on everything from protecting national parks to cleaning-up wildlife habitats, to bringing back to life the land and the oceans that are necessary for both human and animal survival. And if you’re looking to delve into other areas that you wish to support, check out CharityWatch (www.charitywatch.org) and you will find the ones that perfectly match your own mission in life.

 

Giving is a wonderful way to support the best of humanity, and receiving a tax deduction for your kindness is an added bonus.

 

Source:  Baret News

 

Facebook
Google+
http://newenglandnewsonline.com/tax-tips-for-gifting-in-2017/
Twitter
Pinterest
LinkedIn

Social media & sharing icons powered by UltimatelySocial