Donations You Can Make for a Tax Write-Off This Year
Donations
Are you looking for ways to reduce your tax bill this year while also supporting a good cause?
Making charitable donations can help you achieve both goals.
By donating to eligible charitable organizations, you can claim a tax deduction and save money on your taxes.
In this blog post, we’ll explore some of the different types of donations you can make that may be eligible for a tax write-off.
Cash Donations
Cash donations are one of the most common types of charitable donations and are also one of the easiest to make.
You can donate cash or a check to a charity and claim a deduction on your taxes.
Keep in mind that if you donate more than $250 in cash, you’ll need to obtain a written acknowledgment from the charity that includes the amount of the donation and a statement that you did not receive any goods or services in return for the donation.
Property Donations
Another option for tax-deductible donations is to donate property, such as clothing, furniture, or even a vehicle.
If you donate property worth more than $500, you’ll need to file Form 8283 with your tax return.
The amount you can claim as a deduction will depend on the fair market value of the property at the time of the donation, so be sure to get an appraisal if the property is worth more than $5,000.
Stock Donations
If you own stocks or other investments, you can also donate those assets to a charity.
If you have held the stock for more than one year, you can typically deduct the full fair market value of the stock on the date of the donation.
This can be a great way to support a charity while also avoiding capital gains taxes.
Volunteer Time
While you can’t deduct the value of your time spent volunteering for a charity, you can deduct expenses you incur while volunteering, such as the cost of transportation or supplies.
Keep track of your expenses and save receipts to support your deduction.
Donor-Advised Funds
Another option for charitable giving is to set up a donor-advised fund.
Once you contribute to the fund, you can recommend grants to qualified charities.
You can take an immediate tax deduction for the contribution, but you can distribute the money to charities over time.
Furniture Donation
If you’re looking to get rid of old furniture, consider donating it to a charity.
Not only will you be helping those in need, but you may also be able to claim a tax deduction for the fair market value of the furniture.
Just be sure to get a receipt from the furniture donation charity for your records.
There are many ways to support a good cause and reduce your tax bill at the same time.
From cash donations to stock donations to property donations, there’s an option for everyone.
Be sure to keep detailed records and talk with a tax professional to ensure that your donations are eligible for a tax write-off.
Category: Taxes
