Now that you know how to pick a charity, we’ve got some additional tips for you to help maximize that giving! So grab the checkbook and your favorite pen, and let’s see how we can help ourselves while helping others!
Here are Five Fast Facts on maximizing tax benefits for your giving:
- 💰 A BIG Pile Of Cash - Total annual giving to charities was estimated to be around $557 billion last year! It was a 1.9% increase over 2022…but if you adjust for inflation it was actually down 2.1%. Still, can you imagine how big that pile of cash would be? Scrooge McDuck would be right at home swimming in it!
- ❤️ That’s A Bunch Of…Donations! - If you donate big chunks, consider bunching your donations to get the most tax bang for your buck. For example, instead of giving $1000 each year, give $3000 one year and skip the next two.
- 📈 Everyone Appreciates It - Donating things that appreciate – like property or stocks – is a double win. You avoid paying capital gains tax AND you can claim the deduction for the appreciated (i.e. higher) amount!
- 🤝 Matchmaker, Matchmaker - Don’t forget that a lot of companies do a corporate match for their workers’ donations! Fill out a form, prove you’re donating to a legit charity, and your company will write a check the same size as your donation and send it along with yours! Everyone wins!
- 🔍 The Fine Print - Make sure you understand the fine print for your giving, and check with a tax professional if you have questions. Make sure you know the limits of what you can legally donate, the benefits you should get for the donation, and be certain you’re giving to an actual charity (hint: churches, synagogues, temples, and mosques should be eligible by default, but you can check with the IRS for anything else). And remember, you don’t get tax credit for donations where you get something in return! And always – ALWAYS – keep the receipts. You don’t want to stare down the barrel of an audit without them.
🔥Bottom line: Whether you’re giving out of the kindness of your heart or to get the tax breaks, there’s no reason not to make the best possible use of your giving! You’re giving it anyway, so you might as well enjoy whatever benefits you get as a result of the giving, right?
What’s your best charitable giving tip?
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