GOLDEN VALLEY, Minn. — We are just a few days from the end of the year, and a deadline, if you're planning to make charitable contributions that you want to deduct on your 2021 taxes. Yes, you have until Dec. 31 to make that donation.
“If on New Year's Eve I make a charitable donation using my credit card, do I get to deduct it? And the answer is yes, even though you pay the credit card bill next year,” says Michael Crabtree with Boulay.
Writing a check? Just make sure you mail it by the 31st. When tax time comes you're going to need proof of your donation, regardless of the amount, but once it hits $250 bucks, you'll need something more.
“The biggest recommendation I have, is that if you're making a contribution of $250 or more, you need to get a written acknowledgment from the charity, and that written acknowledgement has to have certain language to it,” says Crabtree.
“It has to address the issue of whether you received anything in exchange for that contribution,” he explains.
“If your acknowledgement doesn't have that, it's useless, even though you might have a cancelled check or other proof,” he adds.
Now maybe you're thinking, I take the standard deduction, so there's no point in adding up my donations. Well, how about this? On your federal taxes, you can still deduct a charitable donation of $300 for an individual, and $600 for a joint return above and beyond the standard deduction. And don't forget your miles.
“If you're driving to a charitable board meeting, or taking a load to the goodwill, those are all charitable miles, and you could kind of add those up, and multiply that by 16 cents, and add it to your tax deductions," Crabtree says.
One more you might not have considered, a charitable donation of appreciated stock or securities.
"If I bought some General Mills stock a long time ago, and I have a huge built-in gain in that stock, I get to deduct the fair market value of that stock, even though I never picked up that gain on the return, so it's a really great bang for your buck kind of donation,” Crabtree says.
You also have until the 31st to donate "cars" to qualifying charities.
Those also need special documentation for tax purposes.