The choice to donate to a charity is usually not only driven by the potential tax break, but the chance to save some money on your taxes as a result is a good advantage. If you itemize deductions on your tax return on income, the IRS allows you to write off the cash value of any contributions or donations you make to tax-exempt organizations.
This is a great way to reduce your taxable income. give back to your community or support an organization that you like
The tax-exempt organizations, also known as 501 (c) (3) charities including:
- religious organizations like churches, synagogues and mosques
- community organizations such as the Boy Scouts of America ™, ™ Scouts and Boys & Girls Clubs of America ™
- educational institutions, including schools, colleges, museums and zoos
- charities like Goodwill ® Army and United Way and Salvation ™ ®
- non-profit hospitals and medical centers
- other nonprofit tax exempt
Generosity is rewarded, but the amount you can deduct is limited.
Generally, you can deduct up to 50% of your adjusted gross income (AGI) that charitable contributions.
For example, if your AGI is $ 50,000 in 2016, the total value of all your charitable donations can not exceed $ 25,000
charitable contributions tax deductible are available in three different forms: .. money, gifts and estate expenses incurred while volunteering
If you give money or a check to a charity, you can usually deduct the full amount of the donation
However, if you receive something in return for your donation -. as a gift card for a free massage - you must subtract the value of massage from the value of your donation.
property donations are difficult.
to all property donations, the IRS insists you deduct the fair market value for the item. All property worth more than $ 250 requires a receipt, and nothing over $ 500 must be verified by an appraiser.
If you are giving away clothes or furniture, the value of the gift is equal to what you expect to pay for the item (s) in a savings or shipping shop store .
to determine the value of cars, boats and airplanes, visit Kelley Blue Book ™ or have the vehicle evaluated by a professional. Remember to consider the condition of the vehicle when determining its value.
In addition, if you incur some expenses while volunteering for a charity, you can deduct those charitable donations. For example, if you use your personal vehicle for delivering canned food to local shelters, you can deduct the mileage. Or, if you bought the paper and poster paint to make signs for your church picnic, these expenses are deductible as long as the church does not reimburse you.
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Whatever you donate, make sure to take pictures of the gift value to support your application, and save receipts for at least three years. Donation TaxAct Assistant offers a free way to keep track of these recipes. Just take a picture of the receipt and save the application. At tax time, you can import these recipes and TaxAct can calculate your deduction and complete applicable tax forms for you. This makes tracking your quick and easy gifts throughout the year.
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