Tax Breaks for Businesses Which Donate to Charity
Are your business taxes getting you down? Here is a great way to lower your business taxes by simply donating to worthy charitable organizations. Your business contribution must be paid in cash or property before the close of the tax year, no matter whether you use the cash method or the accrual method.
How much can a business deduct of the adjusted gross income?
You can deduct up to 50 percent of your adjusted gross income for charitable contributions of either money or property that you give to qualified organizations in most cases and in some cases there are 20 percent and 30 percent limitations that do apply. In order to deduct you contributions you will need to itemize your deductions. You can find out which Tax Exempt Organizations are eligible and which uses deductibility status codes by searching here:
- Tax Exempt Organization Search uses deductibility status codes to identify these limitations.
What Qualifies A Charitable Organization For Businesses to Donate for Tax Breaks
"You may deduct a charitable contribution made to, or for the use of, any of the following organizations that otherwise are qualified under section 170(c) of the Internal Revenue Code:
See Video Below.
- A state or United States possession (or political subdivision thereof), or the United States or the District of Columbia, if made exclusively for public purposes;
- A community chest, corporation, trust, fund, or foundation, organized or created in the United States or its possessions, or under the laws of the United States, any state, the District of Columbia or any possession of the United States, and organized and operated exclusively for charitable, religious, educational, scientific, or literary purposes, or for the prevention of cruelty to children or animals;
- A church, synagogue, or other religious organization;
- A war veterans' organization or its post, auxiliary, trust, or foundation organized in the United States or its possessions;
- A nonprofit volunteer fire company;
- A civil defense organization created under federal, state, or local law (this includes unreimbursed expenses of civil defense volunteers that are directly connected with and solely attributable to their volunteer services);
- A domestic fraternal society, operating under the lodge system, but only if the contribution is to be used exclusively for charitable purposes;
- A nonprofit cemetery company if the funds are irrevocably dedicated to the perpetual care of the cemetery as a whole and not a particular lot or mausoleum crypt" (IRS, 2018).
See Video Below.
Featured Video: 2018 Charitable Contributions
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For the poor shall never cease out of the land: therefore I command thee, saying, Thou shalt open thine hand wide unto thy brother, to thy poor, and to thy needy, in thy land. Deuteronomy 15:11
(Memory verse brought to you by Love the Lord First Ministries)
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This website created by Rev. Penny Dean
Contact us: [email protected]
This website created by Rev. Penny Dean
Contact us: [email protected]
References:
1. Charitable Contribution Deductions | Internal Revenue Service. (2018). Irs.gov. Retrieved 26 October 2018, from https://www.irs.gov/charities-non-profits/charitable-organizations/charitable-contribution-deductions
2. Chambers, Valerie. Mar. 15, 2018 Charitable Contributions. (2018). YouTube. Retrieved 27 October 2018, from https://www.youtube.com/watch?v=dUtEMoXNfDE
3. Photo by rawpixel on Unsplash
1. Charitable Contribution Deductions | Internal Revenue Service. (2018). Irs.gov. Retrieved 26 October 2018, from https://www.irs.gov/charities-non-profits/charitable-organizations/charitable-contribution-deductions
2. Chambers, Valerie. Mar. 15, 2018 Charitable Contributions. (2018). YouTube. Retrieved 27 October 2018, from https://www.youtube.com/watch?v=dUtEMoXNfDE
3. Photo by rawpixel on Unsplash