Among the many reasons why people give to organizations like Twin Cities Habitat for Humanity, there is a bonus by means of a tax deduction. By far the main reason why people give is to make the world a better place. At Twin Cities Habitat, our mission to eliminate poverty housing is close to many hearts. Creating a solid foundation through homeownership has a multi-generational impact for families in the Twin Cities. But don’t forget, your generous gift can give back when tax time comes around.
When itemizing donations on your tax return, a donation could save you hundreds of dollars. This of course, all depends on an individual’s filing status, tax bracket, and donation amount. The IRS provides a Deducting Contributions at a Glance guide, but if you’re not preparing your own return, a tax professional will help you along the way to understand how it all works.
Non-cash donations can also be deducted. Our ReStore locations accept a variety of household items and can be used as a deduction as well. When you make a donation, you’ll receive a receipt. It’s then up to you to decide the fair-market value of the donation. Charity Navigator has a handy guide on the tax benefits of giving if you want to learn a bit more.
Another tax-savvy way to make charitable gifts is to donate appreciated securities like stocks, bonds, or mutual funds that you’ve owned for more than one year. This strategic choice (vs. selling the stock, paying the related taxes, and donating the proceeds) can result in greater tax savings as a donor and a larger gift to support Habitat’s mission. Through this option, the more appreciation the securities have earned, the greater potential for tax savings.
The Timing is Important
A contribution is only deductible in the year it’s given. This means your donation needs to take place in the same calendar year as your tax return. Regarding a check donation, you can mail it on December 29 and would still be considered a gift of 2017, even though the check won’t clear until 2018. It’s important to note, that the IRS requires documentation of any gift. In case of an audit, it’s important to read up on certain laws or consult a tax professional to make sure you keep the required documentation.
Ways to Give
Twin Cities Habitat is a 501(c)3 charitable organization and can transform your generosity into helping others. Please consider learning more about how your gift can make an impact and help your bottom line when tax seasons begins.
- Give online
- Give in honor of someone
- Donate household items to the ReStore
- Donate Stock or IRA’s
- Donate by phone or mail
- Donate Real Estate
Note: This information is meant to be helpful in considering the potential benefits of making a tax-deductible charity donation. For advice on your specific tax situation, you should consult your own tax adviser.