5 Year-End Tax Tips For Charitable Donations
NEW YORK (TheStreet) -- Say what you want about Americans, there's no denying the USA is the most generous country on Earth.
According to Philanthropy magazine, America gives $300 billion annually to charity, with 79% coming directly from individuals and the rest from foundations (15%) and corporations (6%). It's light years ahead of the competition, Philanthropy says:
Per capita, Americans voluntarily donate something like seven times as much as continental Europeans. Even our kissing cousins the Canadians, whose culture resembles ours in so many other ways, give to charity at substantially lower rates, and at half the total volume of an American household.
Philanthropy cites the high rate of givers "from the most religious nation on earth" and America's" deep-rooted tradition" of helping the less fortunate as the biggest drivers of charitable giving growth in the U.S. Giving is especially strong during the holidays, with 64% of Americans planning to donate to charity this month.Turbo Tax offer some tips that could result in "big savings" on your next tax bill: Use a credit card. Charitable givers should know that credit card payments are deductible in the year they are charged, not the year they are paid. In other words, you can donate this year and pay next year (in January, ideally). Plus, if there's any fraudulent activity linked to the donation or to the charity, you'll have more leverage in getting your money back from your card carrier. Give a gift, pocket the deduction. Crowdfunding websites such as Razoo allow you to give charitable giving "gift cards" as holiday presents (from $10 to $500) and get the best of both worlds: the happiness of giving and satisfaction of claiming the charitable donation. According to the Internal Revenue Service, to qualify as a deduction, "clothing and household items donated to charity generally must be in good used condition or better." There is a fairly big exception, the IRS adds: "A clothing or household item for which a taxpayer claims a deduction of over $500 does not have to meet this standard if the taxpayer includes a qualified appraisal of the item with the return. Household items include furniture, furnishings, electronics, appliances and linens."
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