Taxes are hardly something anybody likes dealing with. Filing a tax return and paying taxes is a legal obligation and it can’t be avoided. However, there are many ways – and they are legal – in which you can spend your money in a better way than give it directly to the state and at the same time get a tax deduction for that. Donations are one of these ways.
Many people like the idea to donate money, clothes, or other items to charitable organizations, which later distribute them to the people who need it. It is great when something you don’t need can be of use to somebody else. If there were no charities, many poor individuals might have died or at least they would have lived in even more striking poverty.
Charitable organizations have existed for many years. There are many wealthy individuals, who establish a charity and fund it. There are also many charities, which are supported mainly by donations from the general public.
However, when you decide to make a donation not only because you want to support a cause but because you want to get a deduction from your taxable income, it is vital to know that not every charity you donate to will be a tax deduction.
Only donations to qualified charities count for tax purposes. Tax authorities publish lists of such organizations, so before you make a donation, check if the charitable organization you plan to donate to is a qualified charity or not.
Also, always keep you receipts for the donation. Without a valid receipt you don’t have a proof for the donation and you won’t be able to get the tax deductions.