You're a generous sort, right? You probably support any number of causes, such as your alma mater, your church, a few favored charities, and of course your hopeless nephew, Chip. If you give to qualified charities (your alma mater, church, and many charitable organizations qualify, but Chip probably won't), Uncle Sam is often willing to give you a tax break by letting you include donations among your itemized deductions.
There are lots of rules governing this, of course, which you can read about from our own Roy Lewis (TMF Taxes) in our Tax Center. Here are a few things to keep in mind, though:
- Time is running out. If you want to get the benefit as soon as possible, you'll need to donate in 2004. That means you have just a few weeks left to give.
- If you don't have enough deductions to make itemizing worthwhile, you might consider "bunching" your donations. Imagine that you donate $1,000 to charity each year. Instead of giving every January, you might make your 2005 contributions this December, so that you can add them to the 2004 contributions you made last January. That way, in 2004, you'll have given $2,000 instead of just $1,000.
- Remember that for donations of $250 or more, you'll need to be able to show receipts or proof of the donations, so get and keep them. Or, donate less than $250. You might, for example, break up a planned $400 donation, giving $200 now and $200 in a few months (not a few days -- that will look fishy).
- Consider donating stock -- it can be a more efficient way to give.
Now that you're eager to write some checks, permit me to introduce you to a few charities we'd love you to meet. They're ones we're supporting in our annual Foolanthropy drive, and they were nominated by Fools like you. Please consider yourself invited to learn more about them:
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Canine Companions for
Independence: Enhancing the lives of people with disabilities by providing highly trained assistance dogs and ongoing support to ensure quality partnerships.
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First Book: Giving children from low-income families the opportunity to read and own their first new books.
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Habitat for Humanity International: Seeking to eliminate poverty housing and homelessness from the world and to make decent shelter a matter of conscience and action.
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Heifer Project International: Empowering people to lift themselves out of poverty in a sustainable way with gifts of farm animals and training.
- Spirit of America: Extending the good will of the American people to assist those advancing freedom and peace abroad.
And consider dropping by our Foolanthropy discussion board to share your own thoughts on how and why you donate and to see what others have to say.
Finally, here are some other Foolish thoughts on giving:
This article from earlier this year discusses how to change the world, touching on some companies such as Apple (NASDAQ:AAPL), Microsoft (NASDAQ:MSFT), and Ford (NYSE:F) and how they've done so.
Longtime Fool contributor Selena Maranjian owns shares of Microsoft.
