Charitable giving is a very good way to help non profit organizations and, at the same time, help your finances. A qualified charitable donation is tax deductible. When you donate to a non profit organization, you need to make sure that it is a qualified organization so that the amount you give 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 save more money. The more taxes you save, the more money you will have to put in your bank account to use for other purposes.

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

When you make a donation of any size, you should try to claim the tax deductions. The tax benefit for donations is available for taxpayers who itemize deductions on their tax returns. The IRS says that about one-third of all taxpayers itemize. Taxpayers who take a standard deduction receive no additional tax benefit for their donations. 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 charity 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 obtain a qualified written appraisal. For more information on how to claim tax deductions properly, you can consult the charitable giving answer book.