December is almost over, and that means tax time is shortly arriving! While everyone is running around doing their last minute Christmas shopping, people are also making charitable contributions left and right. Did you know that some 40 percent of all individual charitable donations are made in December? The American charitable sector is the largest in the world, with Americans contributing more than $300 billion per year in money plus $260 billion in volunteer time to many charities.
With that being said, many people do not deduct their charitable contributions on their tax return. Here are some helpful free tax tips that can be found at www.1040Return.com. Also, by using 1040Return.com to complete your taxes, it is easy and free to deduct your charitable contributions. Here are some guidelines to follow when deducting charitable contributions.
Guidelines for Monetary Donations
Remember you must always have a receipt (cash donations are no longer deductible without one) and only donate non-cash items in good or better condition. Donations of $250 or more also require an acknowledgement from the charitable organization.
Action to take:
- Taxpayer must have a bank record or a written communication from the charity showing the name of the charity and the date and amount of the contribution.
- For payroll deductions, the taxpayer should retain a pay stub, a Form W-2 wage statement or other document furnished by the employer showing the total amount withheld for charity, along with the pledge card showing the name of the charity.
- Make any last minute donations and collect all applicable receipts
- Consider donating appreciated stock to gain additional tax benefits. If you are considering this alternative, it is always best to seek qualified advice prior to making this donation.
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