The holidays are a time to spread joy and show generosity towards the people and causes close to our hearts. For many, the spirit of the season inspires charitable giving—proven by the fact Americans gave $449.64 billion in 2019, and nearly twice as much is donated in December than any other month.
While pure goodwill is the main reason to give, when and how you make charitable donations can also be pragmatic. As the calendar year comes to an end, so does the fiscal year—and soon enough, you’ll be filing taxes. Many companies also offer matching donations around the holidays to receive tax deductions when filing in April. The benefit is twofold: you can get a tax deduction and optimize your giving if your employer offers to match your contribution. If you’re thinking of giving this season, follow these tips to make the most of your charitable donations.
Choose Your Causes Thoughtfully
Not all charities are created equal. Some charities maintain much higher overhead costs, meaning less of your charitable donation goes to the cause itself. On the other hand, many charities keep low to moderate overhead ranging from 10 to 30 percent. This means 70 to 90 percent of your donation goes directly to the goods and services that support the mission. Resources like GiveWell and Charity Navigator can help you assess charities before you donate.
The goal is to choose charities that align with your convictions and do the most good. By giving to organizations that tackle issues you care deeply about, you’re investing in a better future. Make sure your dollars go to good use.
Review Your Charitable Donations for Tax Deductions
Back to pragmatics: donating to charity is one way to reduce your taxable income. And with a little planning, you can easily optimize your deductions. The first step to qualify for a tax deduction is to donate to an IRS-approved nonprofit organization. Not all nonprofit organizations are tax-deductible. However, in some cases, you can also receive tax deductions for expenses related to volunteer work—such as non-reimbursed transportation or supplies.
Always save your receipts, and keep track of which charities you gift and how much you give. Free mobile apps like ItsDeductable make it easy to keep tabs on your donations throughout the year. So when it’s time to file, you know where you stand and can share the correct documentation with your accountant.
Make Charitable Donations With a DEXSTA Credit Card
These days, you can put nearly everything on a credit card—including many charitable donations. For all intents and purposes, contributions made by card are the same as those made in cash. And there’s no easier way to donate than with your DEXSTA Visa credit card. Plus, if you have the DEXSTA Visa Platinum Rewards credit card, you can earn points and rewards for every dollar you donate. Contact us to learn more.
Donate to Support the Children’s Miracle Network
Want to help us decorate the Holiday Tree this year? Purchase a holiday icon for $1.00 at your local DEXSTA branch. Your donation helps us decorate the trees in our branches and 100% of the money goes to support the Children’s Miracle Network. Purchase your icon at any of our drive-thrus or branch lobbies with an appointment.