Charitable Donations and the Taxman: What You Need To Know

Research by the reputable National Institutes of Health (NIH) has confirmed that the mere act of making charitable donations makes donors feel better. This could be a good enough reason to donate to charities although different people have different reasons for doing so. Some want to leave legacies while others simply want to make the world a better place. Whatever your motivation, charitable giving is one of the most noble things you can commit to. The act of giving is so satisfying that the giver does not feel as if he or she has lost anything. Moreover, charitable giving comes with some tax benefits and it would be prudent to make use of the tax deductions that you are entitled to as a result of your donation. Tax deductions for in-kind donations Most people who are unable (or averse) to make cash donations usually make in-kind donations. If you therefore have items of clothing, electronics, furniture, etc that you no longer need, donating them to a charitable institution will not only help people in need but will actually entitle you to a tax deduction. What the IRS requires is that you get a receipt from the charitable institution you donated to showing the value of the items donated. The only additional requirement that IRS makes is that the items donated should be in good condition.