Although donating to a charity should not be based around what you get out of it, it doesn't hurt to get an incentive either. So what kind of tax breaks can you get?
The New York times wrote an article discussing the support that is building for the government offering incentives to hire workers that have been laid off, which can be found HERE.
So that's great.. but it hasn't passed yet. Well there are currently other programs that the IRS offered this year if you hired an unemployed veteran or a "disconnected youth". Each of these groups had restrictions but employers must request a certification from their particular state workforce agency, such as ODJFS, called Form 8850. These are used in order to introduce youth that may not be doing well in school with a trade that they may enjoy and work towards or helping a veteran obtain a job that they may have had training with. In order to qualify for this credit you must meet the restrictions of the employee and have them begin to work anytime between 2009 and 2010.
That is great if you want to hire somebody, but for right now you just need yourself. So what options do you have? Well if you are donating to a 501(c)(3) organization that means that the gifts made are fully tax-deductible to the amount allowed by law, although you must keep a record of donation, some organizations such as churches do not require a 501(c)(3) in order to have the tax exempt status. The form 1040, Schedule A can be used to itemize your donations.
The amount you donate and your adjusted gross income determine how much you of a donation you can put on your itemized form. Many people do not reach this limit, but generally a person cannot donate more than half of their adjusted gross income. It is also possible to donate property, but anything over $250.00 has special requirements attached.
The most important thing to do is consult your tax professional and be sure to check if your charitable organization has a 501(c)(3) designation so you can get the most bang for your buck. This will allow you to feel good about what you are doing and help yourself in the process!
It's interesting to know that there are tax deductions for hiring unemployed veterans or a "disconnected youths". Unfortunately, I'm not in a position to hire anyone, but it's nice to know that employers have these options. For me, having my son and myself in college and what I give at church, are pretty substantial tax deductions.
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