Tip For Receiving Charitable Deduction
Aside from holiday shopping, many of us are now deciding what causes merit our year-end charitable gifts. You should, of course, have an eye on receiving an income tax deduction for these donations to nonprofits. But the rules for charitable deductions aren't so simple. Don't let that deter you! Bill Bischoff has a good overview on this topic -- here are a few quick excerpts from his piece:
● You must itemize deductions to gain tax savings, and in most cases, people who don't own homes don't itemize because their standard-deduction amount — $5,000 for singles or $10,000 for joint filers — exceeds their total itemized deductions.
● Some nonprofits aren't qualified charities for tax purposes. IRS Publication 78 has a master list of qualified organizations. It's updated quarterly and can be found in many public libraries as well as the IRS web site.
● Make sure you have the right documentation for the type and size of gift you've made. Bischoff provides a full list here.