Boxing Day December 26th Donations and Charitable Tax Deductions
The holiday season is about giving to others,
whether you’re giving presents to loved one or donating to charitable
organizations. No holiday is more about giving back, though, then Boxing Day, which takes place on Dec. 26, the day
after Christmas.
What is Boxing Day?
According to Wikipedia the
unofficial holiday of Boxing Day originated as an old British custom of tradesmen collecting “Christmas boxes” of money or
presents on the first weekday after Christmas as thanks for good service,
mentioned by the English diarist Samuel
Pepys (1633–1703). Theories behind ‘Boxing’ Day include references to
Christmas gifts, charity drives, or a nautical tradition. No matter
how the tradition began, though, it's been around for centuries, and it's
celebrated by charitably giving back to people and communities.
Boxing Day is December 26th, the day
after Christmas and is the last formal giving day before the beginning of the
new tax year. It is important to note that there are extra tax incentives
to charitable giving in 2021. Now is a great time to make
charitable gifts to take advantage of the great tax benefits! In
fact, The IRS
Encourages Taxpayers to Consider Charitable Contributions more
about that later. But first, if you want to celebrate Boxing Day this year,
consider this before you make your donation:
1. Consider this when choosing a charitable organization.
This is a very important
step to making decisions about where to spend your money and time when it comes
to charitable giving. Look into to the charity websites and see what they say.
Talk to people who work at the charities of your choice to find out more
information or discuss experiences with other donors. You can also ask for
proof of charitable tax status such as IRS Tax form 990, EIN # and / or letter
from the Secretary of State. You should be confident that your gift will be
properly used.
Kate Torgovnick How to pick the charity that’s right for you published on TED Blog recommends this approach:
Start with a broad search and
narrow it from there. You can use websites like Guidestar.org, GreatNonprofits.org, Philanthropedia and GiveWell.org. They each have flaws. I say—use
them, but don’t rely on them. Then, do in-person interviews with your top
two or three. Call the charity and ask for a tour or overview meeting. That’s
why charities have development departments — to nurture and build relationships
with donors. If you are going to make a long-term commitment to an
organization, even if the money isn’t huge, you owe it to yourself to do this
kind of research in the same way you would go to a dealership to test-drive a
car.
2.
How do you want to make the donation?
There are five ways to donate. You can donate
money, time, resources, things and shop.
A donation of money. Yours’s and others.
Charitable
giving whether it’s a little or a lot are always welcome especially for the
small locally run nonprofit organizations. You can choose to give
once a year or on a weekly / monthly schedule and request your donation be
applied to a specific fund within the organization. Just think $1 / week over time adds up to $52 /
year to a specific project within an organization which could make a big
difference for the recipient of that gift. For example, $36 will pay for 1 year of mentoring membership for
1 woman entrepreneur.
Celebrations and life events have become popular theme for to raise money for your favorite charitable organizations. Instead of a wedding registry, for example, you can set-up a charitable registry. Gifts for a bar mitzvah or a graduation can be made in the form of donations instead of gifts. Another idea is to ask your friends and family to make a donation on your behalf or the behalf of a loved one instead of buying you’re a gift for the holidays and life celebrations.
A donation of time. You become the unofficial fundraiser.
Spend your time becoming
an unofficial fundraiser for the charity or nonprofit organization you which to
donate to. Here are a few fundraising ideas for you to consider:
- Create a fundraiser by asking your friends, and neighbors to
make a donation of money, services or items to the cause you have
selected.
- Organize a fundraiser on
virtually (online) on Facebook and Instagram
- Crowdfunding on platforms like
Kickstarter, Indiegogo or GoFundMe.
- Set up GivingTuesday and Boxing Day campaigns.
Volunteering
is another way to donate your time like helping with executing fundraising
activities, community projects, events, connecting with the community, helping
with the day-to-day activities of the organization is welcomed.
A
donation of resources. Who do you know?
You can
donate your skill set, business services, experience and you can be a
connection to a an individual, business, organization, service, or skill set
that may be able to help further the mission of the organization.
A
donation of things.
Whether you support your
local thrift shop or want to give to a bigger cause, there are many items you
can donate. Whether you are considering donating your unused things or making a
purchase to give directly to a charity is a good idea to check in with the
charity to see what they can use and will accept. The most popular items to
donate clothing however other items such as food, kitchen items, art, furniture
event your car in some cases.
A donation of shopping.
Many
nonprofit organizations can be supported through making a purchase. For
example, some organizations have T-shirts, mugs, books, art available at an
online store, storefront, or gift shop where the funds from your purchase go
towards their cause. Many businesses have adopted a charity to
support, when making a purchase from them a percent of their revenue is sent to
the nonprofit.
There are so many ways to make donations over the holidays and beyond, whether you’re giving gifts of money, time, resources, shopping or other items.
IRS Charitable Donations
The website Don’t Mess with Taxes “Boxing Day Gift Giving Ideas and Tax Tips” suggests the
following:
Make sure your gifts are to Internal Revenue Service-qualified charities by Dec. 31. Be sure to check out the links listed above about checking out charities. It's important not only from a tax standpoint, but for your personal financial safety. Each year when the charitable giving season arrives, so do related identity theft scams.
I recommend you review the IRS regs for new 2021 tax year. Just like last year, individuals, including married individuals filing separate returns, who take the standard deduction can claim a deduction of up to $300 on their 2021 federal income tax for their charitable cash contributions made to certain qualifying charitable organizations. For married individuals filing a joint return, the maximum deduction is increased to $600. Check this out from the Internal Revenue Service (IRS) Expanded tax benefits help individuals and businesses give to charity in 2021.
Don't feel guilty about taking the tax break if
you donate. We know that most folks tend to give because they want to, not
because Uncle Sam rewards them at filing time. Here’s an article from the IRS encouraging taxpayers to make those donations before
the end of the 2021 tax year.
This holiday season be sure to pay it forward.
You don't have to give something huge to make a difference in your community!
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