As the saying goes, it really is better to give than receive—especially when supporting charitable organizations who work tirelessly to bridge the needs of our communities. While it is important to fund these vital institutions, it is also important to give wisely. Since charitable contributions are tax-deductible, these donations can play a role in many estate plans, provide a way to avoid capital gains tax and reduce your yearly income taxes.
There are two types of giving—reactive and proactive. Donations for natural disasters, local charities hosting events and friends running races for disease research are often given quickly and without much planning. If you are considering a long-term donation strategy, particularly if you are weighing the considerable social and tax benefits, it may be time to channel your money into a cause you are truly passionate about—whether it is for childhood cancer research, organizations that boost the underprivileged or organizations that serve the world at large. Deciding to give a certain percentage of your income will have a significant impact on your yearly taxes as well.
While it may be easier during the holidays to be more generous with your charitable donations, it’s important to research the organizations before giving them money. Ensure you get the highest “social good return” for your money.
Thankfully, there are watchdog programs and services available to help you choose a cause that you are both passionate about and uses funds effectively. GiveWell, Philanthropedia, Charity Navigator and Bright Funds are all great places to start.
You don’t have to give thousands of dollars to a charity to make a real difference. For instance, medical treatment for people living in extreme poverty costs just $0.50 per person and can drastically impact their daily life and health. When you find the right organization, every little bit helps.
Whether charitable giving is something you do once a year or throughout the year, Busey is here to help make sure you make the most of your hard-earned money and tax incentives. Contact us today or call 1.800.67 | Busey.
On behalf of the nonprofits you support, thank you for paying it forward.
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