As 2020 winds down, you may be planning to complete your charitable giving for this year. Here are a few tax concerns to keep in mind.
1. Your gift is tax-deductible only if it is made to a “qualified” charity.
2. The value of services you render to a charity are not deductible.
3. Out-of-pocket expenses while doing volunteer work for a charity, such as telephone charges, travel and uniforms are deductible.
4. Auto expenses may be taken at the standard mileage rate of 14 cents per mile or you may deduct your actual expenses.
5. Tickets to charitable events are only deductible to the extent the price exceeds the value received. for example, you pay $35 for a show put on by the charity of which the price of the ticket is $10, your contribution deduction is $25.
6. Cash contributions of any amount must be substantiated by proper records. For those under $250, a bank record, cancelled check or credit card usually will suffice.
7. Those of $250 or more must generally be substantiated by a written acknowledgment from the charity obtained before you file you tax return.
8. Non-cash contributions exceeding $5,000 other than publicly traded securities require a qualified appraisal.
9. Contributions are deductible only if you itemize deductions. And, there are limited as to the amount you can deduct in any one tax year.
There are many events that occur throughout the year that can affect your tax situation. Call Tim Pearson & Co. today at (248) 720-0608 or schedule an appointment online by clicking here.