Monday, 21 November 2011

Tax Deductions for Contributions to Charitable Organizations

The season of giving is upon us, and California tax lawyers find that for many Americans, this is the time to contribute to their favorite charities. Fortunately, donations to charity are eligible for tax deductions. However, in order to be eligible for these tax directions, your contribution must meet certain criteria.

You can only claim a charitable tax deduction if the donation has been made to an organization that has been exempted under IRS section 501 (c) (3). These include hospitals, churches, and schools. To ensure that your donation is tax-exempt, ask the charity that you're considering donating to, whether it has received a tax-exempt status.

Donations to political parties are not eligible for tax exemption. Similarly, contributions made to private individuals are not eligible for tax deductions. Any donations made to a for-profit organization also is not eligible for a tax deduction
If you want to qualify for tax deductions for charitable donations, you must itemize each donation on your tax forms. You must also maintain a record of the charitable contribution. Records in the form of a confirmation from the charity, or from a bank receipt must be presented in order to be eligible for a tax deduction on a charitable contribution of $250 or more.

Some volunteers who have given their time, but not money, to charitable activities may also qualify for tax deductions. However, the value of the time is not tax-deductible. Rather, the expenses involved in offering the time could be tax-exempt. For instance, you may not be able to deduct the value of your time volunteering for a charity, but you can claim the expenses used to get to the charity, like your travel costs to and from the charity. If you use private transportation, make sure that you keep a record of your gas bills, and if you use public translation, retain your fare tickets.

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