Opinion: It’s time to give your money away | First

The problem:
The associations need your help.
What we think:
Plan for charitable donations for this year’s taxes.
Tell us what you think:
Email us at [email protected]
Who likes to save money? Who likes to help people? The good news, for those who answered “me” to both, is that the US tax code allows them to be done simultaneously. And as the end of the calendar year approaches, there’s no better time than now to plan your charitable giving and tax breaks for 2021.
Colorado Springs is known to have anchored a small army of nonprofit organizations. A quick google says the city has nearly 3,900. So what does this mean for for-profit businesses?
This from Fidelity Charitable: âThere is a financial incentive for Americans to give generously to charity: when you donate to a 501 (c) (3) public charity⦠you may qualify for a tax deduction. ‘income tax. The whole point of charitable tax deductions is to lower your taxable income and your tax bill, and in this case, make the world a better place while you’re at it.
Charitable giving boomed when the COVID-19 pandemic first hit our shores in early 2020. In fact, charitable giving increased 2% in 2020 compared to 2019, according to The Blackbaud Institute, a research division of cloud computing company Blackbaud, which works with nonprofits. But the memories are short and while this level of giving may not last until 2021, the need certainly will.
Good news: The IRS has changed the rules to attract more charitable giving this year. For example, the limit on corporate donations has been raised to 25% of taxable income.
From the IRS: “The law now allows C corporations to apply an increased limit (increased corporate limit) of 25% of taxable income for charitable cash contributions they make to qualifying charities over the course of of calendar year 2021. Normally, the maximum allowable deduction is limited to 10% of the taxable income of a company.
The IRS notes that the increased business limit does not automatically apply and that Body C “must choose the increased business limit on a contribution-by-contribution basis.”
The IRS has also increased the limits on the amounts deductible by businesses for certain donated food products.
“Businesses that donate food inventory and are eligible for the existing enhanced deduction (for contributions for the care of the sick, needy and infants) may be eligible for increased deduction limits,” according to the IRS. âFor contributions paid in 2021, the ceiling for these contribution deductions is raised from 15% to 25%. For C corporations, the 25% limit is based on their taxable income. For other businesses, including sole proprietorships, partnerships, and S corporations, the limit is based on their total net income for the year from all trades or businesses from which contributions are made. A special method of calculating the increased deduction continues to apply, as do food quality standards and other requirements. “
Also note: Keep good records, as special rules apply to any taxpayer claiming a charitable donation deduction.
“Usually this includes obtaining a receipt from the charity before filing a return and keeping a void check or credit card receipt for cash contributions,” according to the IRS. “For donations of property, additional record keeping rules apply and may include filing a Form 8283 and obtaining a qualified appraisal in some cases.”
But what if you really want to donate somewhere but don’t know where to start?
It’s your lucky day! The Colorado Springs Business Journal every year joins our charitable branch, the Give! Campaign, and we’re highlighting deserving nonprofits in the community in November and December. Look for our first feature film next week.
For more details on charitable giving, see publication 526, available at IRS.gov.
Now, for the sake of your wallet, get out there and give your money away!