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Show Year-end tax planninq should include review of contributions By KENNETH J.ROSE Business Counselor Rose& Associates A regular part of your year-end tax planning should include a thorough review of your charitable contributions. The charitable contribution con-tribution is one of the few deductions deduc-tions that has not been disrupted or diminished by the new tax laws. Cash contributions are the easiest to count and cause the least amount of problem. If there are large amounts to any single organization (over $3,000) you should be sure to have a receipt, statement or other evidence of the amount of the contributions con-tributions made during the year to substantiate the deduction. Don't overlook the small cash contributions that you may give to the March of Dimes and other organizations that solicit by sending volunteers door to door in your neighborhood. These may not seem like a lot at the time, but they can add up in a hurry. Don't forget the payroll deductions that you authorized for the United Way either. Another often overlooked contribution con-tribution is the in-kind donations to charitable organizations. Year end is a good time to clean out your garage, basement, closet or anywhere else you stow all of those unwanted items. You remember, the things that you haven't used in who knows how long, probably never will use, but have never taken the time or effort to throw out. Don't throw them out. Bundle them up, take them to the Deseret Industries or some other organization organiza-tion for their giant rummage sale, and count them as a deduction on your tax return. You can only count the lesser of the fair market value or your cost in the property, but again that could add up to several hundred dollars rather quickly. Again, if these accumulate to more than $500 you have to get a statement from them as evidence of the contribution and attach it to your tax return, with a special form that has to be filled out. Also overlooked are the out-of-pocket expenses that you incur in behalf of a charitable organization. For most of us that boils down to auto expenses. You can deduct twelve cents per mile for use of your car for charitable organizations. organiza-tions. If you are considering some very sizable donations, the procedures would be the same. You may need to get appraisals on valuable property proper-ty such as land, collectibles, jewelry, jew-elry, art or investments, but you will still need the separate statement. Some of you may want to consider con-sider establishing your favorite charity as the beneficiary in a life insurance policy. To do that you will have to designate the charity as an irrevocable beneficiary. Then you can deduct the premiums that you pay on the policy as a contribution. contribu-tion. Probably the most important rule to follow is to make sure that the organizations to which you want to make contributions are reputable. There are many organizations soliciting contributions, especially at this time of year. Just because they are qualified non-profit organizations by the IRS, it doesn't mean that they are qualified charitable organizations. Give only to organizations with which you are familiar, or check them out. The Better Business Bureau Bu-reau can help you sift through the different organizations, as can the Stale Consumer Protection Division. Divi-sion. The IRS also has an official list of qualified charitable organiza- , lions. Your contributions in a given tax year are limited to your taxable income in-come if you itemize deductions. You can carry over any deductions that you can't use to later years. If you don't itemize, you will miss out on the benefit of the charitable contribution con-tribution deduction. |