Charitable giving and taxes
Many people donate to nonprofit organizations and
other philanthropic groups out of a personal desire
to do good for others. Such charitable giving can
improve the lives of others and may make donors
eligible for tax deductions.
According to the U.S. Internal Revenue Service,
donors may deduct charitable contributions of money
or property made to qualified organizations. These
generally include religious organizations, veterans
organizations, nonprofit groups qualified under sec-
tion 170(c) of the Internal Revenue Code, and some
other groups as well. The Canada Revenue Agency
lists registered charities, registered low-cost hous-
ing corporations, national arts service organizations,
registered Canadian amateur athletic associations,
and some educational universities among the organi-
zations that may qualify donors for tax deductions.
Canadian individuals and businesses generally can
claim deductions and gifts of up to 75 percent of net
income. In the United States, the IRS states one gen-
erally may deduct up to 50 percent of adjusted gross
income, but 20 percent and 30 percent limitations
apply in some cases.
Giving can constitute cash and non-cash donations,
advises the charity watchdog organization Charity
Navigator. For example, deductions for donations of
clothing and household items that are in “good condi-
tion or better” may qualify donors for tax deduc-
tions. Donors are advised to bring items to reputable
charities that will issue a receipt for their value. An
appraisal may be requested for more expensive items.
All donations require a paper trail and
proof of charitable contribution. The
Government of Canada states that
official donation receipts from reg-
istered charities and other qualified
organizations should be kept in a safe
place. While these receipts need not be
submitted at the time of filing (whether
on paper returns or electronic filings),
they should be kept for five years in the
event they are subjected to review.
Timing donations properly is key. The
IRS says that contributions made in
cash or other property must be made
before the close of the tax year to be
deductible.
A tax treaty between the United States
and Canada allows for some deduction
of donations made to charities across
the border. Again, it is best to consult
with a tax professional in these matters
as some contributions to foreign orga-
nizations are not deductible.
Charitable giving has many benefits,
including feeling good about oneself,
helping the less fortunate and the financial reward of
qualifying for some tax breaks.
TOGETHER, WE FUND 1,400+
CULTURAL NONPROFITS IN
OREGON.
THAT MEANS MORE DRAMA.
Cottage Theatre is a community-supported theatre: more than one third
of the theatre’s annual budget comes from donations from people like you.
Your gift to Cottage Theatre (and the Opal Center, Historical Society, and
other cultural institutions) qualifies you to claim the Oregon cultural tax
credit. Its the cultural donation you get back at tax time. Talk to your CPA,
or learn more at (503) 986-0088 or CulturalTrust.org.
DOUBLE THE LOVE. HERE’S HOW:
Cottage Theatre. Funded in part by the Oregon Cultural Trust.
6 • 2017 Year End Giving
1. TOTAL
2. GIVE
3. CLAIM
YOUR DONATIONS
TO CULTURE
A MATCHING
AMOUNT TO THE
CULTURAL TRUST
CULTURAL TAX
CREDIT ON YOUR
STATE TAXES