Roman J. Salamon

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5 Financial Benefits of Donating to Charity

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While you may have already filed your taxes for 2016, it is never too late to start thinking about ways to save on your taxes for next year. One of the easiest and most cost-effective ways to reduce your tax bill is to donate to charity. These donations can help you save money and improve your long-term financial stability. In fact, consider how donating to a charity, like United Way of Rock River Valley, could help your finances in these five ways.

1. You Get a Tax Deduction Based on Your Tax Bracket.

Donations to charities are a great way to cut down on the taxes you owe. When you donate, the amount you can claim on your taxes is the opposite percentage of your tax bracket, reports Michael F. Kay of Forbes. 

For example, you can claim a $100 donation by donating $75 if your tax bracket is 25 percent.

This means that your donated amount could save you from paying taxes on up to 50 percent of your annual income. However, those making more than $100,000 annually may be subject to stricter limitations on donation amounts.

2. You Can Take Advantage of the Value in Your Unused Property.

Unused property can be donated to charities in your community too. Instead of having a garage sale, consider donating older or unused property to local organizations. The value of donated property can be deducted from your taxes as well, helping you save and accrue savings or retirement goals.

3. Donating Improves Personal Budgeting Skills.

One of the great challenges of making your finances work for you is having strong budgeting skills. Since every donation should be tracked for use when preparing your taxes, donations can help you save money in the long-term. Essentially, you learn better budgeting skills when you donate to charity, giving you the opportunity to save for the things you want and need.

4. It May Make You Eligible for Charitable Assistance in the Future.

Regardless of your current financial stability, you may need help one day. When you donate to charitable organizations, like United Way of Rock River Valley, you are putting money to help people in the future too. In fact, some organizations may offer unique benefits, like compassionate loan programs, to those who donate, when times get tough. Think of it like putting money aside in case something happens in the future.

5. Charitable Donations Improve the Value of Your Community.

Donations made to organizations in your community help to lift those in need out of poverty, give meals to the hungry and help those without jobs overcome their challenges. As a result, your donation comes back to improve the overall health and value of your community. It is like investing in your own property and street while still helping those in need.

Donate to United Way of Rock River Valley to Take Advantage of These Benefits.

The key to making sure you can truly gain a return from your donations is ensuring the charity you select maintains proper documentation with the IRS and has a strong reputation for putting donations to use in communities. Rather than donating to organizations you may not know much about, donate to United Way of Rock River Valley now, and put your money in hands that know how to make the most of it for those in need. 

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Guest Saturday, 25 November 2017