I have written a lot recently about this being the time when you must start thinking about big moves you can make if you still want to really affect your tax picture. Granted, this is a discussion that is not for everyone. You need to have a certain amount of money (and possibly in the right places) for some of that to really matter. For this week, though, I want to talk about a smaller thing that everyone can do.
Tax laws are currently set up that you usually cannot claim a deduction for charitable contributions unless you are itemizing your deductions. Legislation passed during the coronavirus pandemic, however, allowed for everyone to claim some of that deduction for tax year 2020 and it will now continue through the 2021 tax year. This allows an individual to claim up to $300, with married people filing a joint return qualifying for up to $600.
Now sure, as I intimated above, this is not a huge amount of money and not being taxed on a few hundred dollars isn’t going to result in you getting some massive windfall of a tax refund. I do still want to highlight the availability of this deduction, though, as an extra little impetus to do an extra little good during this time of year when many could use it.
First, I don’t want this to be such a push as to be asking those who cannot afford it to donate money they do not have. Your obligation then is to take care of yourself and any family depending on you. Beyond that, though, if you can give, please do. Chances are really good that you will feel better about putting the money there than in your next few coffees.
So if you do have enough to give, give to something meaningful to you. Is there an organization doing something in your local area that you admire? Have you or someone in your family personally benefitted from the work of a charitable group? Do you feel a pull to a cause every time you hear about it but have never actually donated to it? No matter where you fall, no matter how you feel, there are connections that can be found which will leave you feeling happy and satisfied with where a donation goes.
And all of that is even before you get that little tax benefit at the end of it. So how can you lose?
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