Cash Donations

The cash donations you make to a charitable institution could entitle you to a tax deduction but there are some conditions that you’ll be required to fulfill. For starters, the donation must be made to a qualified institution. Some of the donations that will not make you qualify for tax deductions include donations made to individuals, private foundations and foreign governments and charities. All tax deductions to charitable donations are effective in the year when the payment is made. For this reason, if you, for instance, made a payment using your credit card, you are entitled to a deduction in the same year even if it is possible that you’ll pay the credit card company much later. Documenting donations The IRS requires that you maintain proper records of the donations you have made for you to qualify for tax deductions. Some of the documents accepted by the IRS include receipts from charitable organizations, bank statements and credit card statements. Donating to charities helps better the lives of people in need and the fact that you are entitled to tax deductions for your generous contribution is a welcome bonus.