Five Tips for Year-End Gifts to Charity

1. Qualified charities. You can only deduct gifts you give to qualified charities. Give us a call if you’re not sure if the group you give to is a qualified organization. Remember that you can deduct donations you give to churches, synagogues, temples, mosques and government agencies.

2. Monetary donations. Gifts of money include those made in cash or by check, electronic funds transfer, credit card and payroll deduction. You must have a bank record or a written statement from the charity to deduct any gift of money on your tax return. This is true regardless of the amount of the gift. The statement must show the name of the charity and the date and amount of the contribution. Bank records include canceled checks, or bank, credit union and credit card statements. If you give by payroll deductions, you should retain a pay stub, a Form W-2 wage statement or other document from your employer. It must show the total amount withheld for charity, along with the pledge card showing the name of the charity.

3. Household goods. Household items include furniture, furnishings, electronics, appliances and linens. If you donate clothing and household items to charity they generally must be in at least good used condition to claim a tax deduction. If you claim a deduction of over $500 for an item it doesn’t have to meet this standard if you include a qualified appraisal of the item with your tax return.
4. Records required. You must get an acknowledgment from a charity for each deductible donation (either money or property) of $250 or more. Additional rules apply to the statement for gifts of that amount. This statement is in addition to the records required for deducting cash gifts. However, one statement with all of the required information may meet both requirements.

5. Year-end gifts. You can deduct contributions in the year you make them. If you charge your gift to a credit card before the end of the year it will count for 2014. This is true even if you don’t pay the credit card bill until 2015. Also, a check will count for 2014 as long as you mail it in 2014. Special rules apply if you give a car, boat or airplane to charity. For more information about this and other questions about charitable giving, please contact our office.

Please contact us if you need help understanding which deductions and tax credits you are entitled to. We are always available to assist you.

Is Your Social Security Benefits Taxable?
Some people must pay taxes on part of their Social Security benefits. Others find that their benefits aren’t taxable. If you get Social Security, we can help you determine if some – or all – of your benefits are taxable. Here are five tips about how Social Security affects your taxes:
1. If you receive these benefits in 2014, you should receive a Form SSA-1099, Social Security Benefit Statement, showing the amount.
2. If Social Security was your only source of income in 2014, your benefits may not be taxable. You also may not need to file a federal income tax return next spring.
3. If you get income from other sources, then you may have to pay taxes on some of your benefits.
4. Your income and filing status affect whether you must pay taxes on your Social Security.
5. A quick way to find out if any of your benefits may be taxable is to add one-half of your Social Security benefits to all your other income, including any tax-exempt interest. Next, compare this total to the base amounts below. If your total is more than the base amount for your filing status, then some of your benefits may be taxable. The three base amounts are:
$25,000 – for single, head of household, qualifying widow or widower with a dependent child or married individuals filing separately who did not live with their spouse at any time during the year
$32,000 – for married couples filing jointly
$0 – for married persons filing separately who lived together at any time during the year

Please contact us if you need help understanding which deductions and tax credits you are entitled to. We are always available to assist you.