I donate, you donate, we all donate. Here are five quick facts about donations and your 1040 taxes:
- Donations are only tax deductible if they are through a qualified charitable organization. Before you donate, you can ask the organization or check them at https://www.irs.gov/charities-non-profits/tax-exempt-organization-search.
- Donations to individuals are NEVER deductible. While it is kind to give food or money to the homeless or money to someone on a mission trip, IRS does not acknowledge direct donations.
- Non-Cash Donations over $500 in total require much more documentation on your tax return. You must document what was donated, what date, and the value of each donation. Also keep in mind that the more you donate, the more likely IRS is going to ask for your receipts.
- Donations of cars, boats or airplanes require even more documentation. You should receive Form 1098C for vehicles. Without this form, you can’t claim the donation of your vehicle.
- Donations only help on your taxes if you itemize your deductions. The current standard deduction is $12,200 for most single filers and $24,400 for most married filing jointly filers under the age 65. If your itemized deduction total is less than this, then you will end up using the standard deduction and your charitable donations will not help on your taxes.
Tax preparation, payroll processing, HR services… For a list of all our top notch services catered towards Clergy, visit our website at https://www.clergyfinancial.com/services/
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Clergy Financial Resources serves as a resource for clients to help analyze the complexity of clergy tax law, church payroll & HR issues. Our professionals are committed to helping clients stay informed about tax news, developments and trends in various specialty areas.
This article is intended to provide readers with guidance in tax matters. The article does not constitute, and should not be treated as professional advice regarding the use of any particular tax technique. Every effort has been made to assure the accuracy of the information. Clergy Financial Resources and the author do not assume responsibility for any individual’s reliance upon the information provided in the article. Readers should independently verify all information before applying it to a particular fact situation, and should independently determine the impact of any particular tax planning technique. If you are seeking legal advice, you are encouraged to consult an attorney.
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