4 Things to Know About Charitable Donations and Taxes
With the holiday season upon us and the end of the year rapidly approaching, you might be feeling a bit more charitable than usual. Not only is giving to charity a nice thing to do, but in some cases, it can be a smart tax move. Here are a few things you ought to know if you're planning to reap some tax benefits from your donations.
Though your primary goal in giving to charity might be to help the less fortunate, there's nothing wrong with lowering your taxes in the process. Any time you donate money to charity, you can take a deduction for that amount provided you retain a receipt, and your tax savings will be a function of the amount you give, coupled with your effective tax rate. In other words, if you donate $500 and your effective tax rate is 30%, you'll shave $150 off your tax bill.
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Source: Fool.com
