You might be able to turn money donated to your kids’ school into a tax break.
Did you volunteer at a bake sale? Sorry to hear it, that’s time you’ll never get back. But if you gave money to the PTA, you might be able to take some tax deductions. Tax deductions let you lower your taxable income by that amount and with less income, you pay less taxes. Meaning you can really feel good about giving. Here’s a small guide.
- Overpaying for auction items. If that family photo session is valued at $200 and you paid $250, you can deduct $50 from your income as a charitable donation.
- Direct donations. Damn that PTA president is persistent. If she found you and seemingly forced you to donate to the annual fund, it’s most likely tax deductible.
- Wrapping paper, chocolates. All the crap you felt compelled to buy because some kid has a good sales pitch is not tax deductible if you keep it. But if you don’t need the calories or don’t have space for additional decorative touches, donate the stuff and then you can deduct the price from your income.
- The tickets to the dinner dance are not deductible. Unless the price you paid is worth more than the value you got. Only then can that amount be deducted.
- Vehicles. If you gave a whole entire car away – or this is something you’re considering – here’s what you need to know.
What to save:
You may not have to send these documents with your tax returns, but these documents are good to include with your other tax records.
- Canceled check to the organization.
- Credit card statement showing a payment to the organization.
- Receipt from the organization.
- Annual giving statement from the charity or non-profit.
- E-mail confirmation from the organization.
- Written acknowledgement for vehicle donations.
- Itemized list of the items you donated.
- Vehicle identification number for vehicle donations.
- Signed over vehicle title.
- Phone bill, if you gave a donation through a text message.
- Valuations of stocks, real estate, art, or jewelry donated to a charity.
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