Charitable Giving

There are many substantial and important reasons to give money to charity and if you are planning to do so for the 2013 tax year – now is the time to take a look. Although we will provide a brief overview here, please do not hesitate to contact us with any questions you have regarding charitable donations and your tax planning.

The reasons to donate to charity are endless and positive…the benefit of sharing generosity, healing, help and kindness far outweigh the benefit of deducting it off of your taxes. However, if you can share wealth and benevolence AND get a tax break…why not?

In order to take advantage of this deduction, you MUST itemize your taxes. The contribution must be deducted for the year in which it was given (which is why NOW if the perfect time) and MOST, but not ALL of charitable organizations qualify – so it is important to check in advance. There are also limits to how much you can deduct, but they are quite high.

There are rules for non-cash donations such as an old car or donating household goods and clothes to Goodwill or Salvation Army. These places will give you a receipt, but sometimes it is up to you to determine the fair market value. The fair market value is what the item is worth NOW, not how much you paid for the item when it was new.

Always document your giving and keep track of any receipts you get. It can be a beneficial to donate money using a check or electronic transfer so that you have a bank record of the transaction. Either way – always document your giving. This helps you stay organized and makes tax time a breeze!

The following are all examples of organizations in which you can generally give and deduct: churches and related religious organizations, tax-exempt educational organizations, hospitals and some medical research organizations, a political subdivision or government unit, publicly supported organizations (such as PBS), certain private foundations and some membership organizations.

Here at Numerico, we understand all the ins and outs of charitable giving, and how it impacts your financial picture. We would love to offer advice and answer any questions that you have.