It is already widely known that the passage of the Tax Cuts
and Jobs Act means fewer taxpayers will be itemizing deductions on their tax
returns early next year. This means that I will not be spending a lot of time
over the next month or so talking about last-minute moves one can make to
improve your tax picture. For many, those options have been decrease. This also
unfortunately means that I will not be steering as many people to make some
late-year charitable donations and then enjoy the tax benefit.
Hopefully, most thought of that latter benefit as a
corollary bonus and not the main impetus behind making those donations, for
they are still needed.
Giving Tuesday just passed this week, and we are in the time
of year when donations reach high levels as feelings of goodwill and hopes of
peace drive many to help others. It is not the only time we have had those
thoughts this year, though, as recovering from traumatic events like hurricanes
and wildfires also necessitated leaning on the generosity of others.
And when you look at the amount of money that can be raised
for such wonderful and worthy causes, it can be very heartening. So even if
there is a larger chance that making such donations may no longer affect your
tax picture, I still want to express the hope that it will not affect your
inclination to give if you have the ability to do so.
At the same time, though, there are scammers out there
trying to take advantage of this goodwill. It seems that every time a disaster
comes along, there are stories of fraudulent people and organizations that pop
up to collect money and not pass it along to those they were claiming to help.
That is only bound to happen in this more general season of giving, too.
Although it may feel bad to question someone who is claiming
to be doing a selfless act, it can do you good to implement a little due
diligence and look up the credentials of an organization before making a
donation. Sure, there are some large charities that we all know about and
trust, but many smaller ones are also doing great work. You may support their
mission and just not have known they existed.
So just to ensure that you can feel confident about where
your money is going, the IRS offers a Tax
Exempt Organization Search online. It provides information on an
organization’s tax status, allowing you to confirm it is a tax-exempt entity
and eligible to receive tax-deductible charitable contributions. It is an easy
check at legitimacy, for if it is a legitimate entity, there is no reason why
it would not have formally received tax-exempt status through the agency.
And as always, remember that if something feels fishy, it is
worth investigating before you commit to anything. But when things don’t feel
fishy, they can instead feel great and wonderful, so please commit to helping
there.
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