We all know that certain charitable contributions can be tax deductible. This means that when you give to charity you can deduct it from your income tax return thereby potentially lowering your tax liability. Of course, it has its limitations.

1. More Charitable Deductions Possible
We all know that certain charitable contributions can be tax deductible. This means that
when you give to charity you can deduct it from your income tax return thereby
potentially lowering your tax liability. Of course, it has its limitations.
The Internal Revenue Service allows for such deductions but within reason. Therefore,
they have rules that regulate how you can deduct these contributions. One of them has
to do with the need for the charitable organization to be recognized and qualified under
IRS guidelines.
After that you need to have proper documentation of the amount that you donated which
means you need to get a receipt from them that shows their name, your name and the
amount of money you gave them. If it’s property you will also need to show
documentation from the company that assessed the equivalent value of the property.
But it’s not only this that you can deduct from your return. There are also other things
you can deduct while you’re doing something for your favorite charity. One of them is
mileage – the mileage you used to do work for the charity.
For example, let’s say you work with your local food bank charity group and you use
your own vehicle to help bring meals to the needy. You can deduct the mileage that you
use using the standard mileage chart used by the IRS which comes to a little over 10
cents per mile. If you prefer you can just deduct the cost of the fuel you use. You can
also deduct all the tolls and parking fees where applicable.
Other than fuel and mileage you can also deduct money that you spent for the
organization. That is to say if you used your own money to pay for that organization’s
expenses such as buying office supplies and you didn’t get reimbursed you can deduct
the amount as long as you have documentation. It will basically be like you donated
directly to that charitable organization.
Get more financial advice from Deborah Koval.