ORLANDO, Fla. – Thanksgiving weekend is about more than just shopping and great deals, it’s also the start of the charitable giving seasons.
News 6 Anchor Lisa Bell spoke with CBS News Business Analyst Jill Schlesinger about how to make sure you’re making the right financial decisions when donating to charity.
Bell: This is a time of year when many people try to make some donations to charities that are near and dear to their heart. Can you talk about the tax benefits of giving?
Schlesinger: Well, you know, you only can get a tax benefit if you’re the kind of taxpayer who itemizes your deductions. Now, remember, we had a big change in the tax code at the end of 2017 — part of that meant that the standard deduction got a lot bigger. So, that means only about 12% of tax filers actually itemize. If you really think that you’re close to itemizing and you’re feeling really charitable, maybe give a little bit more this year, give a little bit less next year. But most people do not give to get a charitable deduction. Most people give because they want to do good.
Bell: Yeah, and it is important to do your research before you give, including making sure you’re giving to the right charities. So, what can you do to make sure that what you’re giving to is, in fact, a real charity?
Schlesinger: The best place to figure this out, go to irs.gov, the IRS website. Use the tax exempt organization search tool. You pop the name of this charity into the search bar and just make sure it’s listed there. If it’s not, you can just say, ‘I’m not giving.’ Now listen, as a rule, do not donate over the phone. Please don’t give anyone your credit card or your other personal information until you verify the organization is legitimate. Now, if you’d like to see how much of your donation goes to supporting programs versus their overhead. I’ve got some ideas. There’s the Wise Giving Alliance, or Charity Navigator, CharityWatch; these are all extremely helpful resources.
Bell: Good advice and we do know that older Americans have a different way to give. Tell us about that.
Schlesinger: This is such a cool opportunity. If you’re over the age of 70 and a half and you’ve got a traditional IRA account — meaning the money hasn’t been taxed yet in that account — you may want to consider something called a qualified charitable distribution, a QCD. This allows you to make a gift of up to $105,000 directly from your IRA account to any number of public charities. Now, the cool thing is, when you send the money directly from the account to the charity, you don’t have to include that as a distribution for tax time. So this is a very good opportunity for people to maybe give money away do good, but not pay tax on the money. Also, a QCD it might satisfy your required minimum distribution, if you have one. So check that out. A really great tool. 70 and a half is where you can do it, and remember, those distributions, those have to be taken by the end of the year.
You can catch Jill on “CBS Mornings” and “CBS Evening News with Norah O’Donnell.”
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