Thursday, March 1, 2012

Donating to Charity in 5 Simple Steps

I’m not the biggest of fans when it comes to making cash donations to charities; however, this doesn’t mean I’m against all forms of charitable donation or that I don’t like helping others; just the opposite in fact. Whether it’s donating by way of canned goods, clothing, household accessories, automobiles, or my own time and energy, I’ve given back in many different ways over the years.

Here are the five steps that I use in helping me to decide how and where to donate to charity.

Step #1 – Determine How to Donate
The first step I typically take in donating to charity, is determining how to donate. Some people prefer giving cash, others their time, skills, and physical labor. When I was younger and single, I preferred to donate my time and energy.

Now, as an adult with a family and career, I prefer to donate by way of personal belongings that we no longer need. This way I’m keeping our household tidy and organized and making use of things that we no longer want but that other people might.

Step #2 – Selecting Charities
My second step to donating to charity is to select an organization or organizations that I feel comfortable working with. Personally, since I take advantage of shopping at the Goodwill store and another resale shop in a nearby neighborhood, those are the places to which I typically make my donations. In a way, I’m just continuing the reuse and renew cycle.

Step #3 – Tracking Donations
When I make a donation to such operations, I ensure I get a receipt for the goods I’ve given. While such receipts are often just a signed slip that I’m allowed to fill in with a list of what I’ve donated since the organizations typically don’t have the time to go through and provide a written inventory, I try to do this as soon as I’ve made donations, ensuring that I can give a proper accounting of items and associated values before I forget.

Step #4 – Getting Something Back for Giving Something Back
With my receipts as proof of donation, I will typically take an estimated charitable donation amount as a deduction on our annual itemized tax return. In the past, this deduction typically ranges somewhere in the $250 to $500 range. However, on years in which we utilize the standard deduction, our donation doesn’t do anything for me in the way of reducing taxes, but it still holds intrinsic value.

Step #5 – Help Others Help Others
I often help the in-laws do their spring cleaning, which typically results in a lot of stuff being set out in the donate pile. While certain clothing items they might set out throughout the year for the Veteran’s Association to pick up, when it comes to larger donation goods, my wife and I will typically load up their stuff and deliver it for them. This allows us to donate in another way, by helping others help others, and it helps them recognize the tax savings of charitable donations as well.

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