Small business owners all over America make a big difference in their communities and beyond through charitable giving. Some just can't say "no" when solicited; others have pet causes they champion; more than a few give to buoy their standing in the community; still others line up for the business and tax benefits. No matter what the reason, extending a hand to help always creates good will. Keep the following in mind, and you'll be way ahead of the game.
- If you're looking for a tax deduction, make sure the beneficiary of your contribution qualifies as a legitimate public charity.
- Cause-related marketing, although not deductible as a charitable contribution, does amount to a tax-deductible marketing expense.
- Always keep accurate records of your contributions.
It's not always about the moneyDonation of products and services as well as special events participation can do a world of good.
Put your excess inventory to good useTranslate problems like slow-moving or obsolete inventory into ready-made tax deductions through charitable giving.
Promote your business through charitable affiliationsYou can partner with a charitable organization in a way that brings more customers your way.
Check out the organization before writing that checkMake sure the organization soliciting your gift qualifies as a legitimate charity.
IRS has a search feature to locate legitimate charitable organizations for which there may be a tax deduction. Look for Publication 78. Charity Navigator calls itself "your guide to intelligent giving" and that's exactly what it is.
Finance your charitable goals by transforming your equityIf all of your assets are tied up in your business, and you are thinking of selling, you can transform your equity into a philanthropic fund to finance your charitable goals.
- Donated products must be targeted toward helping needy people like children, the elderly or the sick.
- Advertise your products or services in the communication vehicle of the charities you support.
- A tax-exempt organization is not necessarily one that generates a tax deduction for your contribution.