Best Practices And Important Tips On Charitable Contributions And Taxes

IRS Charitable Deductions

One topic that is frequently viewed as taboo in philanthropic circles is the subject of income taxes and the ways donations can benefit you on your tax return. There really is no need to be shy about the many benefits, the reason those benefits exist is because society views your charitable actions as something worthy of support from the entire community. There are important considerations when it comes to your United States tax code and your annual charitable contributions. Over at the IRS they have prepared eight tips for deducting charitable contributions and it’s worth a careful read.

An overview of the article reveals that the number one consideration involves whether or not the organization that you’re contributing to qualifies for a tax deduction. There is a complete set of rules on what constitutes a qualified organization at the IRS in the form of publication number 526. Because it is so important to stay current, it’s advisable to review this material at least once every tax year.

Contributions to charitable organizations should not make your tax preparation any more difficult for a qualified preparer. Your main task is to retain all proofs of the contribution(s) which may include receipts, bank records or other written communications from the qualified organization. Even if a donation is made using a text message, a phone record which contains the name of the receiving organization, date and amount given will fulfill the record keeping requirements. Be sure to consult with a properly licensed tax adviser, and remember that the more tax money you legally save, the more you will be able to proudly contribute to worthy causes in the future.