How Corporations that make billions in your community can now give millions back ?

FOR IMMEDIATE RELEASE
Snellville, Georgia, United States of America (Free-Press-Release.com) December 20, 2011 -- Charitable Donations to Reduce Corporate Tax Liability Can Help Millions In The Community !

By Tom Livsey, Topic National Banking Editor,

As we get closer to Christmas, and the end of the year, many corporations who have made billions of dollars in your community, can now show their commitment of giving back to the communities where they make their income, through charity giving. So local non-profits need to make themselves known before December 31, 2011 !

Everybody knows that giving to certain charities can be tax-deductible. The amount of deductions you can make depends on your tax bracket and other factors. What’s more, you have the opportunity to contribute to society in some way. But you need to bear in mind a few rules you need to follow.

To be eligible to make the deduction from your taxable income, you must furnish the IRS with the name of the charity, the date and amount of contribution in a written statement from the charity. Alternatively, you can provide the IRS with a bank record in the form of a credit card statement, bank or credit union statement and cancelled checks. Bank statements should show the name of the charity, the date and amount paid whereas credit card statements should show the transaction posting date.

Your contributions can be made in the forms of cash, check, electronic transfers, credit card payments or payroll deductions. If you choose to make payroll deductions, you should fill up a W-2 Form wage statement or other form furnished by your employer that shows the amount withheld for the charity, a pledge card containing the name of the charity. In addition, you should retain your pay stub.

Many contributors choose to do so at the end of the year. If you take this option, remember that contributions made by credit cards are counted for the year the charge is made to your card. So if you charged your credit card in late December 2010, your contribution is deductible in 2010 even though your bill does not fall due until 2011.

Another thing to bear in mind is that only donation to qualified organizations are tax deductible. The list of qualified charities is found in IRS Publication 78. Religious organizations such as churches, synagogues, temples, mosques are qualified charities even though most of them would not be listed under Publication 78, as are government agencies.

To qualify for deductions, you must itemize your deductions in Form 1040 Schedule A. If you make non-cash contributions like clothing and household items, you should obtain a receipt that states the name of the charity, detailed description of the item(s) you contributed, its market value and the date of contribution. If your contribution is worth more than $250 then some additional rules would apply.

If the amount of your deduction for all non-cash contributions is more than $500, you should submit a properly completed Form 8283 together with your tax return.

Tax Deduction for Charity Donations

Contributions to churches and non-profits are tax-deductible

Donations to charity are tax deductible expenses. These donations can reduce your taxable income and lower your tax bill. Not everyone will be able to deduct their charitable contributions, however. You will need to itemize your tax deductions in order to claim any charity.

"You may deduct charitable contributions of money or property made to qualified organizations if you itemize your deductions." (IRS Publication 78)

Donations for Haitian Relief Efforts

For any 2010 charitable donations, remember not to include any donations for Haitian disaster relief efforts if you gave money or property given between January 12 and February 28, 2010, and deducted those amounts on your 2009 tax return. For more about this special treatment, see New Tax Break for Contributions to Haiti Earthquake Relief on the IRS Web site.

Where to Claim the Charity Deduction

You claim your tax deduction on Form 1040, Schedule A (PDF).

Rules for Claiming the Charitable Contribution Deduction

Your gift of cash or property must meet certain criteria in order to be tax-deductible.

You must actually donate cash or property. A pledge or promise to donate is not deductible until you actually pay.

You must contribute to a qualified tax-exempt organization. Charities will let you know if they have received their 501(c)(3) tax-exempt status. Some organizations are not required to obtain 501(c)(3) status from the IRS. These include churches and other religious organizations.

You must be able to itemize. Giving to charity is a great tax planning strategy, but it only works for people who are eligible to itemize their deductions.

You must meet record keeping requirements. This includes saving canceled checks, acknowledgment letters from the charity, and appraisals for donated property.

Keeping Records of Your Charity

Taxpayers are required to keep excellent records of their charitable contributions. Under the Pension Protection Act, you must keep written records of all cash donations. Donations of $250 or more will not be allowed as a tax deduction unless you have supporting documentation. Your records must indicate the name of the charitable organization, the date of your contribution, and the amount your contribution.

Non-Cash Contributions of Property

Contributions of property (other than cash) are subject to strict record keeping and substantiation rules. You must be able to substantiate the fair market value of the goods or property you donated, plus keep any written acknowledgments you receive from the charity.

Fair Market Value of Contributed Property
You must make an assessment of the fair market value of the property you contribute.

Non-Cash Contributions Totalling More Than $500

You must attach IRS Form 8283 if your total non-cash contributions exceeds $500.

Car Contributions: Must Have Written Acknowledgement
If you contribute a car, truck, boat, airplane, or other vehicle, and the vehicle is worth more than $500, you must received a written acknowledgement from the non-profit before you can claim a tax deduction.

Non-Cash Contributions over $5,000: Must Have Written Appraisal
If you contribute property worth more than $5,000, you must obtain a written appraisal of the property's fair market value.

Limits on the Charitable Contribution Deduction

Your charitable contribution tax deduction may be limited. There are limits specific to charitable contributions, and there are general limits on itemized deductions.

50%, 30%, and 20% Limits on Charitable Contributions

Generally, you can deduct cash contributions in full up to 50% of your adjusted gross income.

Generally, you can deduct property contributions in full up to 30% of your adjusted gross income.

Generally, you can deduct contributions of appreciated capital gains assets in full up to 20% of your adjusted gross income.

Charitable contributions in excess of these limits can be carried over to the following tax year. The excess contributions can be carried over for a maximum of five years.

Not Tax Deductible

Contributions are not tax deductible if given to any of the following:

Political parties, political campaigns, or political action committees.

Contributions given to individual people.

Fees or dues paid to professional associations.

Contributions to labor unions, chambers of commerce, or business associations.

Contributions to for-profit schools and hospitals.

Contributions to foreign governments.

Fines or penalties paid to local or state governments.

The value of your time for services rendered to a non-profit

So you can either pay taxes, like you must,or you can use those tax dollars to help your community, and make your conscious effort to make your corp. stand out from their competitor by reviring these dollars to do more good to millions of citizens who are in need of help, instead of paying Uncle Sam.

Charitable Giving


Definition

Charitable giving by individuals and businesses is an important source of funding for nonprofit organizations. These charitable donations are influenced by various factors. For donors in the state of Michigan, "the more common reasons to give to nonprofits are to help others (45.7 percent), to support an organization or cause they believe in (15.5 percent), and felt a moral obligation to contribute (13.4 percent)" (Wilson 2002). While these factors vary for each individual or business, research indicates that tax implications influence the size of the donation.

Donors receive economic benefit from a reduction in the amount of paid taxes. The motivation to reduce taxes by contributing to a nonprofit is known in economic terms as a tax incentive . Tax incentives are incorporated in the tax codes at all levels of government: federal, state and local. The donation is reported on the tax return and used in calculating the ultimate tax liability. The most common tax incentives are either tax deductions or tax credits . The federal tax structure currently employs the use of tax deductions for charitable contributions while state and local governments use both forms in varying degrees.

Charitable tax incentives are a factor in both income and estate taxes . Income tax is an annual levy placed on taxpayers while estate tax is required only when taxpayers die and transfer wealth to their heirs.


Historic Roots

Taxes have been an economic factor in most of recorded world history. In the United States, Abraham Lincoln implemented federal income taxation in 1862 in order to finance the Civil War. Although this income tax was repelled in 1872, the 16 th Amendment established the Internal Revenue Service in 1913 and the federal income tax system has been in existence since that year (Internal Revenue Service "History"). ###

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