Advantages of Your Charitable Giving In 2015

by Redeeming Riches on February 3, 2015

GiftTax Deductions Advantages of Your Charitable Giving in 2015

If you are one of the many individuals that elect to show your generosity throughout the year by donating your time, money, and other resources to people, businesses, and organizations, it is imperative that you become familiar with the tax deductions advantages associated with your charitable giving in 2015. Based on information pulled from the Internal Revenue Service, you have the ability to turn the generosity that you show throughout the year into tax savings if you make appropriate donations to charity and/or other types of non-profit organizations that qualify under the IRS rules. In order to claim any donations that you make in 2015, you will need to itemize the deductions that you have towards charitable giving on your tax return. In this guide, you will learn how to maximize on tax deductions that directly pertain to charitable giving.

IRS Rules Regarding Claiming Donations

If you have an interest in placing tax deductions on your tax return that are related to charitable giving, you must first ensure that your donations have been issued to organizations that are considered to be “qualified” as outlined by the Internal Revenue Service. The following outlines the organizations that the IRS will acknowledge as “qualified”:

  • Religious Organizations
  • Public Parks
  • Public Recreational Centers
  • Government Organizations
  • Non-Profit Organizations, Such as Schools and Hospitals
  • War Veterans Organizations and/or Groups
  • Public Charities, Such as Goodwill and United Way

Once you have determined that your charitable given went to an appropriate and qualified organization, you must ensure that you have documentation of the contributions that you have made. Items that qualify for this type of deduction include cash, household goods and items, clothing, and even the mileage that has been driven in order to assist a charity. The donations that you make must be provided to a charity on or before December 31st 2015 to be filed for the 2015 tax year when you file in 2016.

Basic Tips on Maximizing Tax Savings Pertaining to Charitable Giving

In order to increase the amount of tax savings that you acquire as a result of tax deductions pertaining to charitable giving, you should utilize the following basic tips:

  • First, you should always ensure that you obtain and possess proof of your donation. If you donate cash or items that exceed $250.00 in value, you will need to obtain a written letter from the charity acknowledging this donation. The letter should always include the actual date of the donation and the overall value of the donation. If you elect to donate items that meet or exceed the value of $5,000.00, you will need to obtain an independent appraisal.
  • If you volunteer your time and service, the money you spent doing so may be placed as tax deductions on your tax return. Many volunteers contribute a large amount of their own money in order to purchase supplies, clothing, office items, parking fees, and fuel costs in order to perform the services that they offer. All of these items may be deducted. If you utilize public transportation to go to your volunteer work, this may also be deducted. Be certain to keep proof of all expenses and to make notes as to how they assisted or the impact that they had with your volunteer work.
  • Utilize tools in order to track and appropriately calculate the value of your donations throughout the year. One of the best, IRS-approved tools available today is ItsDeductible. This is a free tool that will help you determine the value of all donations you make and will effectively track those donations throughout the year.

Conclusion

There are a wide range of tax deductions that may be written off on your tax return in 2016 that relate to your charitable giving in 2015. By learning about the rules regarding these deductions and following the tips outlined in this guide, you have the ability to enjoy numerous tax savings. Not only is your gifting of your valuable time, money, and other items to worthwhile causes beneficial to those that benefit from your generosity, these actions may have a significantly positive impact when it comes to your tax liability. While it is not advised to drive your giving based on tax savings, it is considered to be ideal to structure the gifting in such a way that you are able to benefit from your tax deductions that relate to charitable giving in 2015.

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