Charitable Giving: Get The Most Of Your Donations And Time This Holiday Season
With just a few days left before Christmas and a little more than a week left before the end of the year, consumers may be feeling the itch to complete acts of charitable giving. While this time of the year tends to bring out the best in people’s generous side, there are a few things that we should all keep in mind while racing to meet the deadline for lowering your tax burden by donating to charity.
As Consumerist has reported in the past, there are a number of ways not to suck at charitable giving during the last portion of the year.
Going The Food Bank Route
If you’re doing a little winter pantry cleaning to make room for all those holiday-themed products you scooped up at the grocery store, you might be tempted to make a donation to your local food bank. But before you head over with your cans of tartar sauce and sardines in oil keep a few things in mind.
• Why has this product been in your cupboard so long? If the answer to that question is that you would never dream of consuming it, then other people probably don’t want it either.
So instead, xoJane’s Deb Martinson suggested last year, that would-be donors think of it like this: What would you want to eat, using only nonperishable foods?
• Not everyone has the same things available to them that you might. For instance, some consumers might not have can openers or microwaves. That means some of the better items to donate might be things that would help produce on-the-go meals like peanut butter, tuna (with pop-tops) or crackers.
• Just Ask. If all else fails and you just feel completely unknowledgeable about what others would like to eat, just call the local food bank. Many donation centers have a specific list of foods that are in constant need, some might not even be food but other necessities like toilet paper, soap and diapers.
Donating To A Cause Or Organization
When it comes to larger donations, consumers might pick a cause or organization that is near-and-dear to their hearts. While this is always a great option, there are certain things we should all remember before signing the check.
• Is it a legitimate organization? If you’re giving to charity because you’re a good person, and because you want to lower your tax burden, then you must consider how you donate. To include a donation on your 2014 return, you must give to a legitimate, qualified organization — like, for example, Consumerist — before December 31.
Consumerist’s resident “How Not To Suck,” columnist suggested last year that consumers readying to give a donation double-check that their charity of choice is eligible to receive tax-deductible contributions exempt with the Internal Revenue Service.
• You can’t deduct contributions to individuals. While we would never suggest you don’t help out an individual in need, consumers should keep in mind that those types of donations can’t be deducted. This also includes donations to political organizations and candidates.
Giving Your Time
While it is admirable for consumers to provide financial donations to charities, there may be no donation more valuable than your time.
• How far will you time donation go versus your monetary donation? The Washington Post reported earlier this holiday season that WalletHub has a new calculator to help consumer determine what a charity can accomplish with their cash donation. By using the calculator, would-be donors could compare their time contribution to their financial one.
• What skills can you offer the charity that they might be lacking? As the Post points out, consumers might be able to offer a volunteering donation that can’t be matched by a financial donation.
For example, if you’re web-savvy, you might be able to help the organization revamp their online presence – a gift that could continue giving for years to come.
• Donations of time can also provide tax deductions – kind of. Consumerist reported last year that consumers can deduct $0.14 a mile if they drove to the organization. You can also add the cost for tolls and parking.
Make sure to keep good records. Think creatively and you may find many of your actions constitute help for charity.
While the travel costs can be deducted, you can’t actually deduct an hourly rate for your volunteering since you’re not actually being paid.
Don’t Get Taken Advantage Of
No matter how you decide to give this holiday season, make sure your donation is put to good use by checking that the organization is genuine.
Parts of your donation might not go to the rightful pockets. A report from New York state Attorney General Eric T. Schneiderman found that only about 38% of all donations collected by telemarketers actually went to the charitable organizations.
If you’re contacted by a person over the phone soliciting charitable donations for a non-profit organization, it might be best to resist giving on the spot.
Instead, do your homework by researching the charity before you give. The National Association of State Charity Officials provides information on who to contact in your state to research information about charities and fundraising companies.
Additionally, keep in mind that some charities have been found to use donations for other costs, such as paying administrators instead of those in need.
Back in June 2013, the Tampa Bay Times and the Center for Investigative Reporting created a list of charities that give the smallest portion of their income out in cash aid, including one Florida-based organization that collected $127.8 million in donations but reportedly only used $3.2 million to help dying children.
To better ensure your donations are ending up in the right hands used these tools offered by CharityNavigator.org, GuideStar.org and the Better Business Bureau to do some sleuthing.
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