Here are a few tips to keep in mind as you plan your nonprofit contributions this year:
- Choose who you are going to donate to carefully. Not all nonprofit qualify for. Do you research by going to the IRS website (https://www.irs.gov/Charities-&-Non-Profits/Search-for-Charities)
- Get a receipt for every donation, whatever the size. All of the small donations you make throughout the year can add up to mean big tax savings.
- Don’t overlook your payroll deductions such as tithe.
- It is true that you can’t get a tax deduction for volunteering your time, but you do get to deduct certain associated expenses (mileage, etc.).
- Make sure that you are already in a position to itemize your deductions when you file your taxes. If you take the standard deduction it then it likely won’t matter what contributions you made throughout the year,
When in doubt ask your CPA. Be especially cautious when you are contributing large or unique assets such as stocks, vehicles, or works of art. There is quite a bit of red tape here, and not doing it right could put your deduction at risk.