TaxMamas TaxQuips: Tax Quips

TaxMamas TaxQuips: Tax Quips


Cash Donations

August 19, 2014

Today TaxMama® hears from GuideForThePoor in the TaxQuips Forum, who has an interesting question. “Suppose your deductions are too low to itemize, but you still want to give money to charity. Can you give the money to a friend who does itemize – and have the friend donate it to charity and get the deduction?”



 







Dear Guide,



Sure, you are welcome to give your friend any amount of gift you like, up to $14,000 per year, without needing to file a gift tax return.



Your friend is welcome to give all, or part of it, or even more to any charity that you two select.



In fact, this is an excellent way to help charities.



I often advise people who are not in a position to itemize to give their money or household goods to someone who can use the deduction. Wise move.



Bill Porter, EA warns that once you make the gift to your friend, you have no control over that money. If they decide not to donate it, there’s nothing you can do – except not partner with that friend again.



Rita Lewis, EA suggests that if you are close to itemizing, you can use the bunching technique – making a larger donation every other year. Good thoughts from both Bill and Rita.



And remember, you can find answers to all kinds of questions about donations and other tax and business issues, free. Where? Where else? At www.TaxMama.com.



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