Throwback Thursday, Charitable Giving & Tax Deductions


Testify before congressIn true Throwback Thursday fashion, I’m reminiscing about my testimony before Congress, two years ago, to maintain the charitable deduction. Did you know your financial contribution to United Way’s work in education, income and health or another qualified nonprofit organization, qualifies you for an income tax deduction?

There’s no question the charitable deduction is a compelling incentive to drive financial support for health and human services. For example, a taxpayer in the 25 percent tax bracket donates $100 to United Way. When they file their taxes the following year, their tax bill is reduced by $25 which decreases the out of pocket cost of a donation to $75.

The nonprofit sector plays a major role here in the Greater Cleveland community and neighborhoods across the country; and that includes advocacy. In February 2013, the United States Ways and Means Committee held a hearing on charitable deductions at a time when Congress was making key decisions about the federal budget and tax reform. I was one of nearly 15 other United Way CEOs explaining our work to provide educational and employment opportunities and meeting our communities’ basic food and shelter needs. Our plea to Congress was to preserve this tax incentive. Otherwise, nonprofits may not be able to continue their work, and who would care for those in need in our community?

Due to nonprofit advocacy, the charitable deduction still exists. I encourage all tax payers who also donate to organizations and causes close to their hearts to continue taking advantage of this tax break. To qualify for a charitable deduction, a few rules apply:

  • Donations must be made by December 31 of the tax year you’re claiming the deduction
  • You must itemize your expenses
  • Only gifts made to qualifying 501 (c)(3) organizations are eligible

If you have questions about your taxes or would like to schedule an appointment to get your taxes done free of charge, please call United Way 2-1-1 to speak to one of our information and referral specialists.

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