As the end of the year approaches, many people and business owners start to prepare for next year's tax season. They realize that they might owe a sizable debt to the government. They want to come up with ways to save money and claim deductions on their returns. Many decide that it would be a good idea to donate to some of the public charities in their areas. You can use this tactic and get a legal deduction for your taxes by learning how to identify legitimate charitable organizations.
To qualify for this type of exemption as a donor, you are limited to giving money or assets to groups that have a 501 (c) (3) license. This license can only be obtained from the IRS. It requires the group to file documents and provide proof of their legitimacy before the IRS will extend this licensing to them. It also means that the group can give credit to people who donate money or assets to it.
People are advised to make sure the groups they plan to give money or funds to have this licensing. When they donate anyway to for-profit groups, people cannot get the deduction. If they try, the IRS will deny them and possibly audit their returns. They will have to prove that they were not trying to scam the government or get more money back on their taxes
When you file taxes, you have the chance to put down the amount that you donated to the 501 (c) (3) licensed group. Depending on your filing status and other factors, you might need to provide proof the actual receipt from the charity. The receipt will tell the IRS how much you gave, on what date, and the name of the charity that received your contribution.
You also can tell if a charity is legitimate if it has good reviews with the community. The better known organizations tend to advertise their services or make a point of being active in the community that it serves. Groups that are lesser known or conceal their services may not be as trustworthy.
Even so, you might simply want to make the process of donating as straightforward as possible. You may realize that the government allows tax-exempt status to most churches, temples, and other religious entities. You could contribute to your church, get proof of it at the end of the year, and claim the deduction without fear of an audit.
To claim an exemption, it typically has to be $500 or more per year. Donations under that amount are not generally eligible to claim on taxes. Your gift is appreciated but not enough to lower your tax burden.
Lowering your taxes might be your main priority as you get ready for the upcoming tax season. You do not want to owe the government a debt you cannot pay. To lower what you owe and also give much needed cash or assets, you could donate to charities that serve the public. It may be important for you to know what ones can offer you that deduction.
To qualify for this type of exemption as a donor, you are limited to giving money or assets to groups that have a 501 (c) (3) license. This license can only be obtained from the IRS. It requires the group to file documents and provide proof of their legitimacy before the IRS will extend this licensing to them. It also means that the group can give credit to people who donate money or assets to it.
People are advised to make sure the groups they plan to give money or funds to have this licensing. When they donate anyway to for-profit groups, people cannot get the deduction. If they try, the IRS will deny them and possibly audit their returns. They will have to prove that they were not trying to scam the government or get more money back on their taxes
When you file taxes, you have the chance to put down the amount that you donated to the 501 (c) (3) licensed group. Depending on your filing status and other factors, you might need to provide proof the actual receipt from the charity. The receipt will tell the IRS how much you gave, on what date, and the name of the charity that received your contribution.
You also can tell if a charity is legitimate if it has good reviews with the community. The better known organizations tend to advertise their services or make a point of being active in the community that it serves. Groups that are lesser known or conceal their services may not be as trustworthy.
Even so, you might simply want to make the process of donating as straightforward as possible. You may realize that the government allows tax-exempt status to most churches, temples, and other religious entities. You could contribute to your church, get proof of it at the end of the year, and claim the deduction without fear of an audit.
To claim an exemption, it typically has to be $500 or more per year. Donations under that amount are not generally eligible to claim on taxes. Your gift is appreciated but not enough to lower your tax burden.
Lowering your taxes might be your main priority as you get ready for the upcoming tax season. You do not want to owe the government a debt you cannot pay. To lower what you owe and also give much needed cash or assets, you could donate to charities that serve the public. It may be important for you to know what ones can offer you that deduction.
About the Author:
Find a summary of the reasons why you should support public charities and more info about great charity organizations at http://www.tableofplentyhmb.org/board-of-directors right now.
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