Use Your IRA First (70 ½ and older)
Those 70 ½ and older should be using qualified charitable distributions (QCD) from their IRA for all charitable giving or until their required minimum distribution (RMD) is exhausted for the year. This is far more tax beneficial than writing a check to your favorite charities and is our current primary focus on charitable tax planning for clients.
Farm and Business
High income businesses and farmers may be able to increase their QBI deduction (what is QBI?). Farmers should also consider using a gift of grain for maximum tax savings. Consult your GBE advisor for more details.
Example: Mowing for 10 hours at the local church is certainly a worthy deed, but is not tax deductible
Example: You bought a $100 gift basket at a school charity auction. If the goods inside the basket are valued at $80 then a $20 deduction is allowed. You may only deduct to the extent the amount exceeds the value received.
Documentation for Monetary Donations
For donations under $250 you must have a copy of the cancelled check or a receipt from the charity. For donations of $250 or more you must receive a written receipt from the charity, with name, date, amount, and a statement that no goods or services were provided by the charity in return for the donation.
We appreciate and support many non-profit entities. Some of our favorites include:
Concordia University, Nebraska is an excellent academic and Christ-centered community equipping men and women for lives of learning, service and leadership in the church and world. If you will allow us to brag a moment: Click here to view Professor Ryan Burger’s audit class grant program.
Southeast Nebraska CASA recruits, trains and supports community volunteers who advocate for abused and neglected children in the Seward, Saline, Thayer, Jefferson and Gage County court system. https://www.southeastnebraskacasa.org/
Lutheran Family Services of Nebraska expresses God’s love for all people by providing quality human care services that build and strengthen individual, family and community life. https://www.lfsneb.org/donate/
Located at 504 Seward St in Seward, Nebraska, the Et Cetera Thrift Shop provides a local option for your non-cash and goodwill donation items.
The last month of the year is often a good time to plan final charitable contributions. The timing is helpful because you’re able to have a better estimate of income for the year compared to your donations/goals. It’s also helpful because the deduction, should you itemize, will be realized on your tax return just a few months from now.
Thanks for your time and have a great holiday season. We’ll see you soon.