Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
that concept makes ZEEEERO sense to me!
maybe someone can clarify for me!
if you're in the 25% tax bracket, for each dollar you donate, you get 25 cents reduced from the taxes you owe.
well, won't you be much better off if you keep that dollar you were going to donate? lol
i guess i understand if people are donating cause that's what they do....and hey, they get a tax benefit in return....
what i don't understand is people trying to URGE you to donate cash 'in order to' get a tax deduction! lol
that concept makes ZEEEERO sense to me!
maybe someone can clarify for me!
if you're in the 25% tax bracket, for each dollar you donate, you get 25 cents reduced from the taxes you owe.
well, won't you be much better off if you keep that dollar you were going to donate? lol
i guess i understand if people are donating cause that's what they do....and hey, they get a tax benefit in return....
what i don't understand is people trying to URGE you to donate cash 'in order to' get a tax deduction! lol
First of all, you don't donate MONEY. You donate "things" which have a value that you place upon them. For instance, you donate an old living room set to goodwill and you can claim a $500 donation for that - if you think that is the true value of the merchandise....
The objective is to donate enough "stuff" to bring you down to a lower tax bracket. That way you have gotten rid of a lot of "junk" and reduced your tax liability significantly.
You can bet your boots that many people who donate "cash" are getting some kind of financial kick-back or benefit for doing so. Otherwise, they would not have the incentive to do it.
First of all, you don't donate MONEY. You donate "things" which have a value that you place upon them. For instance, you donate an old living room set to goodwill and you can claim a $500 donation for that - if you think that is the true value of the merchandise....
The objective is to donate enough "stuff" to bring you down to a lower tax bracket. That way you have gotten rid of a lot of "junk" and reduced your tax liability significantly.
You can bet your boots that many people who donate "cash" are getting some kind of financial kick-back or benefit for doing so. Otherwise, they would not have the incentive to do it.
20yrsinBranson
I understand donating "stuff" to lower your taxes....no question about it! it's a very smart thing to do. but i was under the impression that when they say "donate cash to lower your taxes" they were talking about cash donations....not "stuff". why would they call it 'donating cash' if what you're donating is 'stuff'?
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
34,690 posts, read 57,994,855 times
Reputation: 46171
Quote:
Originally Posted by Kleenex
...they say "donate cash to lower your taxes" they were talking about cash donations....
That type of hype is no different than realtors telling a buyer that they will be getting a tax deduction for home ownership (taxes and interest). (spend a dollar to receive $.25 (deduction NOT a Credit). Marginal Federal income tax rates are actually very low in the USA. (often below 10% for those filing 1040A's) The tax 'savings' is often dramatically less than 25%.
In the rare cases I have donated CASH, it has been due to a sale of a property or windfall profit and no way to donate appreciated assets (usually stock).(example was 32 yrs of 'Profit sharing' which flowed 2x a yr to neighbors or people with more urgent needs than myself. Giving has always been more important than saving, tho early retirement is stretching my previous wisdom...I'm well cared for and don't mind driving a $35 car).
Charities that ask for CASH using the incentive of promised 'tax savings' should be considered very 'suspect', and likely playing on the emotions and naivety of the ill informed. But... I'm currently volunteering in 3 non-profits, cash is a good thing to get, and can most readily be implemented into providing goods or services!!!
It also does not make sense to donate cash in January 2010 because you can't use that to apply for the 2009 Tax Returns due in April 2010.
It would make sense IF it was Dec 2009 and I already figured my taxes, and if Donating Cash (due to no junk stuff around to donate) will lower my taxes to the next lower bracket; and it would save me tax money.
You can bet your boots that many people who donate "cash" are getting some kind of financial kick-back or benefit for doing so. Otherwise, they would not have the incentive to do it.
Perhaps the person donating the cash had strong feelings about not supporting a particular government program and would prefer to see that money go to a charity in whose work they believe. It could all come down to ideology.
And, I don't believe that the only reason people donate is so that they can get some sort of kick-back. I give donations to organizations frequently without even claiming it on my taxes. I do it because I see a need, I have the resources to share, and I feel good about the work the charities perform. I'm not sure why you'd assume that I have an ulterior motive. I give because I'm moved to do so. It's a simple as that.
.....And, I don't believe that the only reason people donate is so that they can get some sort of kick-back. I give donations to organizations frequently without even claiming it on my taxes. I do it because I see a need, I have the resources to share, and I feel good about the work the charities perform. I'm not sure why you'd assume that I have an ulterior motive. I give because I'm moved to do so. It's a simple as that.
Bingo. The tax deduction is not the primary reason for donating. Most of us who donate to a charity or cause do so because we believe in the work that they do and we want to support it. At least in my case, I would donate anyway, regardless of the tax savings. But if the government wants to reward me for doing it, then I will happily take the deduction.
Charities that ask for CASH using the incentive of promised 'tax savings' should be considered very 'suspect', and likely playing on the emotions and naivety of the ill informed. But... I'm currently volunteering in 3 non-profits, cash is a good thing to get, and can most readily be implemented into providing goods or services!!!
Even the legitimate charities like the Red Cross, Salvation Army and the American Cancer Society note that they are a charitable organization and that contributions are tax deductible.
Unlike certain political leaders who could only manage to contribute $1,500 on their salary, most Americans put aside a portion of their income toward charitable causes they believe in.
You can donate cash, or you could contribute money to an IRA, both would lower your taxable income ONLY if itemizing deductions gives you a higher deduction than you get with a standard deduction. Even harder now with schedule L coming into effect.
It would make sense IF it was Dec 2009 and I already figured my taxes, and if Donating Cash (due to no junk stuff around to donate) will lower my taxes to the next lower bracket; and it would save me tax money.
Actually, this is a common misperception. If you are barely in a higher tax bracket (say just inside the 25% bracket by $100) and itemize your deductions (because that's the only way charitable contributions matter), would it you save you lots of money to donate $125 to charity, thus moving you to a lower tax bracket? NO.
The tax brackets are marginal tax rates. You are going to be taxed at 10% and then 15% up to their respective ceilings. Only that last $100 will be taxed at 25%. Donating $125 to charity is great, but it will only save you $28.75 in taxes ($100 x 25% + $25 x 15%).
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
