Make your charitable contributions count
Taking a deduction for donations made to charitable organizations sounds simple enough: make a donation and claim it on your tax return when you itemize your deductions. Of course, whenever taxes are involved, things are never as simple as they seem. Here are three tips for making your charitable contributions count as a tax deduction.
1. Only donations made to qualified organizations are deductible. You can't deduct contributions to political organizations, candidates, or individuals.
2. To take a deduction for a cash donation of any amount, you have to keep a bank record of the contribution. A canceled check or credit card statement showing the name of the charity and the date and amount of the contribution will work. For cash donations of $250 or more, you have to get written acknowledgment from the charity.
3. Donations of appreciated capital gains property such as stocks or artwork are limited to 20% of your adjusted gross income (AGI). Other non-cash assets are limited to 30% of AGI, and cash donations are limited to 50% of AGI. You can carry extra amounts forward for up to five years.
Giving is simple; getting a tax benefit for your generosity may be less so. Contact us for assistance in maximizing the tax benefits of your charitable contributions.