Tag: donation

Great Ways to Get Charitable Tax Deductions

Follow these tax tips to get the biggest tax savings when making charitable contributions of cash or checks, household goods, cars or appreciated property.

Choose the right organization

In order for your donation to be deductible, it must go to a nonprofit group that is approved by the IRS. Most often, these are charitable, religious or educational organizations, though they can also be everything from your local volunteer fire company to a group for the prevention of cruelty to animals.

  • If you’re not sure whether the group you want to help is approved by the IRS to receive tax-deductible donations, check online at IRS Exempt Organizations Select Check.
  • This site allows you to enter an organization’s name and location to instantly find out if it qualifies.

Make sure it counts

To write off any cash contributions, no matter how small, you need a canceled check, bank record or a receipt with the charity’s name and donation amount. That means that putting cash in the church collection plate or the Salvation Army bucket is a no-no if you want to be able to take a deduction for it.Your resource on tax filingTax season is here! Check out the Tax Center on AOL Finance for all the tips and tools you need to maximize your return.Go Now

As with all deductions, timing is everything. You can take the deduction for your contribution in the year that you make it.

  • For example, if you mailed a check to your favorite charity on December 31, you can write it off on that year’s tax return.
  • If you charge the donation on a credit card, the write-off is claimed in the year the charge is made, even if you don’t pay the credit card bill until the following year.
  • But a pledge to make a donation is different: Because it’s only a promise to make a future donation, there’s no deduction until you actually follow through.

Donations are limited

There’s also a limit on how much you can deduct. The basic rule is that your contributions to qualified public charities, colleges and religious groups can’t exceed 60 percent of your Adjusted Gross Income (AGI) (100% of AGI in 2020 for qualified charities).

  • The caps are a bit lower for gifts to other types of nonprofits. When it comes to gifts of appreciated property, the limit drops to 30 percent of AGI.
  • If these restrictions limit your write-off in the year of the gift, the excess deduction carries over to the next year.

Also, keep in mind that you can’t write off a contribution to the extent that you get something in return.

For example:

  • If you buy a $50 ticket to a fundraising dinner at a church, but the cost of the dinner is $20, you can deduct $30.
    • $50 donation – $20 return = $30 deduction
  • For donations of more than $75, the nonprofit must give you a written statement telling you the value of what you received in return and reminding you that you can’t deduct that portion of your contribution.

There’s also a special rule for folks who donate to colleges and universities and receive the right to buy tickets to school athletic events: They can deduct 80 percent of their donation.

Appreciated property

Cash may be king, but if you want a really big tax saver, your best bet may be a donation of appreciated property—securities, real estate, art, jewelry or antiques.

  • If you have owned the property more than a year, you can deduct its full fair market value and escape income tax on the appreciation.
  • For property held one year or less, IRS only allows you to claim a deduction on the price you paid for it.

Let’s say you own stock that you bought many years ago for $1,000 that is now worth $10,000, and that you intend to make a $10,000 gift to a major fundraiser for your alma mater. If you write a check for $10,000, the college gets $10,000, and you get to deduct $10,000.

If instead, you give the $10,000 worth of stock,

  • The college still gets $10,000 (it won’t owe any tax on the profit when it sells the stock.)
  • You still get to deduct $10,000.
  • You eliminate the tax you’d owe if you sold the stock for $10,000: Such a sale would trigger a capital gains tax on the $9,000 of profit, and that would cost you $1,350. Making your gift with stock instead of cash saves you that $1,350.

If you don’t really want to part with the stock because you think it’s still a good investment, give it away anyway. Then use your $10,000 of cash to buy the shares back in the open market. That way you’ll only be taxed on future appreciation.

How a gift is used affects donor value

If you’re donating tangible personal property, what the charity does with the item affects how much you can deduct.

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  • If you donate land so the local homeless shelter can build a new facility to house more people, you can write off the full market value.
  • If you donate a work of art to the shelter for its fundraising auction, you only get a deduction for the price you paid for the artwork.
  • What if you donated the piece of art to a museum that will display it as part of its collection? In that case, you get to deduct the full market value.

For property worth more than $5,000 ($10,000 for stock in closely-held firms), you’ll need to get a formal appraisal. You’ll also have to make sure the appraiser is a member of a recognized professional group or meets minimum education and experience guidelines. If you don’t, the IRS can disallow your deduction.

Contributing household items

Donating used goods such as clothing, linens, electronics, appliances and furniture gets you a write-off for the item’s fair market value at the time you donated it, which may be considerably less than what you originally paid.

The IRS has a helpful booklet on this subject, Publication 561: Determining the Value of Donated Property.

For items valued at more than $500, you’ll need to fill out Form 8283 and attach it to your return. On this form you have to

  • describe each item over $500 that you donated,
  • identify the recipient, and
  • provide information about the value of the item, including your cost or adjusted basis.

Congress has clamped down on donations of household goods to make sure folks aren’t inflating the value of their used stuff.

  • No tax deduction is allowed unless an item is in good condition or better.
  • If an item in less-than-good condition is valued at more than $500, you can take a deduction only if you get the item appraised and attach the appraisal to your return.
  • Congress also gave the IRS broad authority to deny deductions for low-value items such as used socks and underwear.

When preparing your taxes with TurboTax, you can use ItsDeductible Online to help you value and track your donations. This free program gives guidance on prices for commonly donated items and is designed to transfer your donation information to your tax return. ItsDeductible is a built-in feature on TurboTax Deluxe and above.

Donating vehicles

If the claimed value of your donated vehicle is more than $500, in most cases your deduction is limited to the amount the car brings when it’s sold at auction.

  • The charity has 30 days after it sells your vehicle to issue you a Form 1098-C that shows the sale price.
  • You must attach that form to your tax return or the IRS will disallow the deduction.

There are, however, some situations where you’re permitted to claim the car’s estimated market value:

  • If the charity significantly improves the vehicle,
  • makes significant use of it, or
  • gives the vehicle (or sells it at a discount) to a poor person who needs transportation.

For more information, check the IRS article: IRS Guidance Explains Rules for Vehicle Donations.

Volunteer services

Don’t overlook the volunteer work you perform, which may also generate a deduction. You can write off many out-of-pocket expenses you incur to do good work, such as costs for:

  • materials
  • supplies
  • uniforms
  • stationery
  • stamps
  • parking
  • tolls

You can also deduct the cost of driving to and from your volunteer work, at a rate of 14 cents per mile. If you take public transportation, that bus or rail fare is deductible, too.

But here’s the bad news: The value of services you provide as a volunteer don’t merit a write-off. For instance, if you’re a carpenter and you help a nonprofit group build a home for the poor, you can deduct travel costs and building supplies you buy, but not the value of the work you do. (That’s not as hard-hearted as it may seem. If you were paid to do the work, you’d have to report the pay as income, which would drive up your tax bill.)

For more tax tips in 5 minutes or less, subscribe to the Turbo Tips podcast on Apple Podcasts, Spotify and iHeartRadio

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Retirement Planning Demystified

What you need to know about taking tax deductions for charitable donations. Links in this video: Retirement Planning Insights – https://www.tenonfinancial.com/newsle… Taxes in Retirement – https://www.facebook.com/groups/taxes…#RetirementPlanning#TaxPlanning#CharitableDonations

Doing Good May Make People Look Better

Giving is good for you. For years, researchers have been finding that people who support charities or volunteer for causes can benefit from being generous.

For example, they might learn new things, meet new people or make others whom they care about happier. Researchers have also found that giving may make the givers themselves happier, more confident and even physically healthier.

As experts on the science of giving, we looked into whether there’s another possible upside to doing good: physical attractiveness. It may seem surprising, but across three peer-reviewed studies, we found that others rate people who give money or volunteer for nonprofits, give to their friends and even register as organ donors as more attractive. We also found that more attractive people are also more likely to give in various ways.

While our findings may raise eyebrows, we actually weren’t too surprised – the personal benefits of being generous are well established in our field.

3 studies

Our first study examined data from a large, nationally representative sample of older U.S. adults. We found that seniors who volunteered were rated as more attractive by interviewers than those who did not volunteer – despite the fact that the raters were unaware of respondents’ volunteering status.

The second study analyzed data from a nationally representative sample of U.S. teens for several years. We found that those who volunteered as teenagers were rated as more attractive once they became young adults. We also found the reverse: Those rated as more attractive by interviewers as teenagers were more likely to volunteer when they grew up. Again, raters did not know about participants’ volunteering history.

Our third study used data collected from a sample of Wisconsin teenagers from 1957 until 2011. We found that teens whose yearbook photos were rated as more attractive by 12 raters were more likely to give money over 40 years later, compared to their less attractive peers. We also found that these adult givers were rated as more attractive by interviewers than nongivers around 13 years later, when they were around the age of 72.

In all three studies, raters were asked to give their opinions on how good-looking participants were, using a rating scale where lower numbers meant less attractive, and higher numbers meant more so. Although beauty can be in the eye of the beholder, people often agree on who is more or less attractive.

A halo effect

Our results suggest that giving could make people better-looking, and that being more attractive could make people more likely to donate to charity or volunteer.

These findings build on previous research indicating that beauty confers a “halo” – people attribute other positive characteristics to them, such as intelligence and good social skills.

These halos may explain why attractive people tend to marry better-looking and more educated spouses and are more likely to be employed and make more money.

Those higher earnings, logically, mean that good-looking people have more money to give away. They also make more friends, which means they have larger social networks – subjecting them to more requests to donate and volunteer.

Not just a bias toward beauty

Because we were aware of this beauty bias, in all three of our studies, we statistically controlled for demographic factors such as gender, marital status and income.

We also controlled for respondents’ mental health, physical health and religious participation, given their links to both attractiveness and giving.

So, we know that our results are not explained by these preexisting differences. In other words, it is not merely that more attractive people are more likely to be married, richer, healthier or happier – and therefore more likely to give.

But, there could be other alternative explanations that were not measured.

Why this happens

We would love to know whether doing good actually causes people to be more good-looking. But it is not possible to figure that out for sure.

For example, in studies on what smoking does to your health, scientists could not require some participants to be long-term smokers and other participants to avoid tobacco altogether. Such arrangements would not be ethical or even possible.

Similarly, we can’t require some participants to be long-term givers and others to never volunteer or support charities. Most people give in some way, so asking them to stop would not be realistic, or even ethical.

Still, by following what a group of specific individuals do over time, we can discover whether giving at one time can predict whether someone will be more physically attractive at another time – just like we know that people who smoke have higher rates of lung cancer than those who don’t.

Overall, using the best available evidence, we find that it is indeed possible that doing good today may make you appear better-looking tomorrow.

[You need to understand the coronavirus pandemic, and we can help. Read The Conversation’s newsletter.]

To be sure, we don’t know why beauty and doing good are linked. But it’s possible that people who take care of others are also more likely to take care better care of themselves. This possibility is supported by our previous research showing that volunteers are more likely to get flu shots and take other health precautions.

Taken together, our three studies confirm the link between moral and physical beauty that was described in ancient Greece by the poet Sappho: “He who is fair to look upon is good, and he who is good, will soon be fair also.”

Our findings also contradict myths that beautiful people are shallow or mean, as suggested in the movie “Legally Blonde” and countless other “mean-girls” films about teens.

Instead, we have found another way that doing good could be good for you.

By: Sara Konrath Associate Professor, Indiana University, Lilly Family School of Philanthropy, IUPUI & Femida Handy Professor of Social Policy at the School of Social Policy and Practice, University of Pennsylvania

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Armin Hamidian : Helping To Build Our Center Against Crypto Scams

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Connecticut Software Engineering School Receives $10,000 BTC Donation – Bitcoin News

During the first week of 2019, Holberton School in New Haven, whose two-year higher education program aims to “drive the digital transformation revolution,” received a large cryptocurrency donation. On Monday it was announced that the cofounder of software suite the Scroll Network, Nathan Pitruzzello, donated $10,000 worth of digital currency to the Connecticut school that’s known for recording academic certificates on the BTC chain.

Source: Connecticut Software Engineering School Receives $10,000 BTC Donation – Bitcoin News

A Man Of 3 Worlds: The Russian-American Billionaire Giving Millions To U.S. and U.K. Universities – Angel Au-Yeung

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Len Blavatnik, the Ukrainian-born and Russian-raised billionaire businessman with a net worth of $17.9 billion, says he has given away $500 million to charity so far, mostly to world-renowned universities like Oxford, Harvard, Stanford and Yale. When asked why he favors donating to higher education institutions, he explains shrewdly that for him, conducting philanthropy is like running a business. “It’s the bigger buck, or bigger results for the buck,” he says, in slightly accented English. “Or bigger bang for the buck, so to speak, if I focus on the few top academic institutions……

Read more: https://www.forbes.com/sites/angelauyeung/2018/10/05/len-blavatnik-philanthropy-2018-forbes-400/#844ceef4fa80

 

 

 

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