Charitable giving is a great way to help non profit organizations and, at the same time, help your finances. A qualified donation is tax deductible. Whenever you give to a non profit charity, you need to make sure that it is a qualified organization so that the amount you donate will be tax deductible which will help you lower your income tax obligation to the IRS. By lowering your taxable income, you will owe less taxes and therefore save more money. The more taxes you can save, the more money you will have to put in your savings account to use for any other purposes.

One of the problems is that charitable giving is not without risk. Your donations are an investment in your community, the nation, and the world. It is wise to be careful when you make your donation so you could avoid scam artists who may try to benefit by taking advantage of your kindness. You need to be wary of non profit organizations that spring up overnight in connection with current events or natural disasters. They often will make a compelling case for your money, but as a practical matter, they usually don’t have the infrastructure to get the money to the affected areas or people. Therefore, before you give away your money, you need to ensure that the non profit organization you are about to donate to is legitimate.

When you make a donation of any size, it is best to try to claim the appropriate tax deductions. The tax benefit for donations is available for taxpayers who itemize deductions. The IRS reveals that about one-third of all tax filers itemize. Those who take a standard deduction will not be able to claim the tax deductions resulting from charitable contributions. The IRS reminds taxpayers to keep appropriate records to prove the value of their gifts. For example, for any single gift of $250 or more, a taxpayer must have a written acknowledgment from the non-profit organization by the earlier of the date the person files the tax return or the filing deadline, including extensions. A person donating property valued at more than $5,000 must have a qualified written appraisal. For more information on how to take advantage of tax deductions, you can refer to the charitable giving answer book.