Too many people miss out on great tax deductions because they aren't aware of how many things qualify as charitable deductions. Making the most of your charitable tax deductions involves becoming aware of what is allowable and sometimes planning things around that. Timing is important as well.
Get the most out of charitable events. Most charities can itemize the cost of your attendance at charitable events. They will break it down so that everything over the cost of the meal and entertainment is a deduction. For example, if you go to a $150-a-plate fundraiser with a show, that may give you a deduction of $75 as a charitable expense.
Add up the miles for greater tax savings. You can deduct the cost of driving to your volunteer activities with your church, school or community. You'll get so much per mile traveled. This also can be deducted if you drive people from your church or neighborhood around to doctors or for medical treatments. Driving to and from meetings or training sessions for volunteer organizations is also deductible.
Deduct the cost of special equipment or clothing you buy for the purpose of working with a charitable organization. Adults who buy Girl Scout or Little League uniforms or bats and balls for volunteer work can deduct those expenses. Travel expenses such as hotels and meals eaten out when traveling as a volunteer are also deductible.
Get a tax break when you purchase certain magazines or privilege packages as well. If you buy a membership with dues to the National Geographic or the Smithsonian Institute, you can deduct the difference between the cost of their magazines and the amount you have paid in. If you buy a plan that allows you to purchase tickets to the local university ball games, the price of that plan is deductible as well.
Give goods for a tax-deductible expense. Donate all the clothes no one wears to a charity and get a receipt. These places also take books, furniture and appliances. These bigger items especially bless the needy and you can get paid twice--once by the feeling gotten from doing a good thing and then again with a nice tax deduction.
Give all at once for the whole year. Save your money all year and let it gain interest for you and then give whatever you would have given for the year to your church in late December. They get a nice lump sum and you get a fat deduction after letting your money work for you all year. One more bonus is that record keeping becomes a snap. If you give regularly to other charities, do this with them as well. Make sure that you write on the check that this your donation for the entire year so that they don't ask again too soon.
Get it in writing. To protect yourself, get all of your charitable deductions in writing. This is especially important with those of more than $250, which must be accompanied by written proof to be claimed. The more meticulous records that you keep, the smoother things will go at tax time. For more information, get tax publication 526 from the IRS. The URL is listed in the Resources section below.
Give donations in a lump sum at the end of the year for the greatest use of your money.
Keep meticulous records of mileage, with dates and events, so that you will be legal and aboveboard with your deductions.
- Keep meticulous records of mileage, with dates and events, so that you will be legal and aboveboard with your deductions.
- Give donations in a lump sum at the end of the year for the greatest use of your money.