Giving your time and/or money to a cause is a wonderful thing. You're making the world a better place, one person or community at a time - and the Federal Government agrees. Whether it's old furniture for The Salvation Army, volunteering at a homeless shelter, or donating through FirstGiving, Uncle Sam encourages charitable giving through income tax deductions. The rules, however, can seem complex. If you find yourself driven to give to those in need, and want to take advantage of tax benefits, follow these seven tips.
1. All Donations Must Be Made to IRS-Approved Organizations
Be careful who you give to, the IRS only accepts donations made to qualifying organizations. You can find out which charities qualify by utilizing the Exempt Organization Select Check Tool on the IRS website. Donations to specific individuals are not tax-deductible.
2. You Can't Deduct Your Contributions Unless You Itemize
You must itemize your deductions in order to write off your charitable contributions. If you use an online tax preparation program - such as H&R Block, TaxACT, or TurboTax - just answer the prompts and let the program take you to the appropriate page. If you file your return manually, however, you're going to have a few more forms to fill out.
3. Value Your Non-Cash Donations Effectively
Don't get greedy. Either value your items according to thrift shop resale worth or use an online calculator. If you use tax prep software, it can assist you in valuation, as well. Invest in a professional appraisal for expensive items and keep a modest mindset for everything else. You never want to have to justify a $100 donation for an old computer printer.
4. Maintain Accurate Records
The IRS requires that you have a receipt or statement for any individual contribution of $250 or more - but you do not need records for donations under that threshold. If your total non-cash donations come to more than $500 you need to complete and submit Form 8283.
Regardless of the amount, though, keep bulletproof records of your donations. These should include the name of the organization, the date of the donation, and a detailed explanation of the items given (if not cash). Hang onto your credit card statements and cancelled checks as well.
5. Your Time Is Not Tax Deductible
Let's say you donate a week's worth of time at a soup kitchen, for example. The value of that time is not tax-deductible even though you could have been out earning money. However, if you spend money during that time on transportation, such as gas or parking fees, those expenses are deductible.
6. There Are Limits to What You Can Write Off
If you give a lot, don't assume that it can all be written off, even if you follow the above guidelines. In many cases you are limited to deducting 50% of your adjusted gross income, although this percentage may be lower depending on the type of organization you donate to.
7. Donations Are Not Fully Tax Deductible if You Receive Something in Return
The rules are designed to encourage you to donate. That means that if you benefit from making a particular contribution, Uncle Sam thinks that should factor into the tax implications. If, for example, you give $500 in cash or goods to a qualified organization and receive a gift in return valued at $50, you can only take a $450 deduction on your return.
If you still have any questions or concerns, consult IRS publication 526 or call 1-800-829-1040, Monday through Friday from 7 a.m. to 7 p.m. local time. Taking deductions for your charitable contributions helps those in need and can significantly reduce your tax costs - just be sure to approach the process properly. The last thing you want to do is raise a red flag and have to deal with an audit.
What tips do you have for taking tax deductions on charitable contributions?
Nick Owens is an online editor who covers tax management, lifestyle, and volunteerism.
Recently, the development community was made aware of a vulnerability in the OpenSSL software library that has the potential to put a significant number of the internet's websites at risk.
Dubbed "Heartbleed," this bug allows information to be accessed that would normally be protected by some versions of OpenSSL.
FirstGiving can confirm that our servers and products were not vulnerable to Heartbleed and your secure client data was not affected. If you have any further questions about this issue, please contact the Account Manager or support team in your location.
The Heartbleed bug is considered a significant security threat. For more information about how to protect yourself, see The Heartbleed Hit List: The Passwords You Need To Change Right Now for a list of potentially affected websites and recommendations for further action.
Thank you for your concern and Happy Fundraising!
With less than two weeks till the Boston Marathon, we are reminded of the tragic events that took place almost a year ago. Team MR8, the foundation dedicated to carrying out 8 year old Martin Richard's memory and wishes of "No more hurting people - Peace," has issued a runner's call to arms, asking that members and friends of the running community donate a symbolic $26.20 to the Martin W. Richard Charitable Foundation.
Money raised by this foundation will further Martin's message by investing in education, athletics and community.
Your donation of $26.20 will cement that fact that the city of Boston and runners from around the globe have taken back this historical finish line.
Last week, we were honored to participate in a fundraising study done by craigconnects, Craiglist's Craig Newmark's organization aimed to "give the voiceless a real voice and the powerless real power." It's always exciting to see other prominet individuals positively weigh in on your industry and mission.
The study, presented as an infographic, highlights the incredible growth of crowdfunding and peer-to-peer fundraising initiatives in the nonprofit industry. To give you a taste, we'll pull a few data points. We encourage you to take a peak at the infographic though.
Did you know?
- The number of charitable donations through peer-to-peer fundraising grew last year by 50%.
- From 2012-2013, there was a 60% growth in funds raised through peer-to-peer fundraising alone.
- 28% of those who donate to peer-to-peer fundraising campaigns are repeat donors.
Here's what Mark Sutton, our Nonprofit General Manager, said when asked what makes a nonprofit successful with peer-to-peer fundraising.
"The organizations that raise the most money on FirstGiving are the nonprofits that help their supporters help them. They are the organizations that can identify and nurture their most passionate supporters and arm them with the tools they need to be effective cause ambassadors and fundraisers. Having a peer-to-peer fundraising worthy event, like a fun run, polar plunge, and/or marathon, doesn’t hurt either." - Mark Sutton
Think your organization has what it takes to embark on a successful peer-to-peer fundraising campaign? We've got an ebook for that.
Simply put, online fundraising pages with video outperform those without. We crunched some FirstGiving numbers and here’s what we found:
- Online fundraising pages with video raise an average of $1,182
- Online fundraising pages without video raise an average of $389
Videos are more engaging than text
Now this doesn’t mean that any old video can go up on your fundraisers’ pages. These videos have to speak to the fundraiser’s efforts, the cause, and/or your mission. Basically, it must be relevant.
Emotional, personal requests trump high end video production
Though polished promo videos are exciting, they should be saved for you, the nonprofit organization. The power of peer-to-peer fundraising lies within an individual fundraiser’s network - this is called peer-to-peer fundraising after all. A low quality handheld video captured on a smartphone is all it really takes. The more personal the video the better and remember, keep it short and sweet.
A video should have a donation call-to-action
Make sure the video has a call-to-action. In this case, you’ll want to remind your fundraisers that their video should explicitly ask the viewers to donate to their online fundraising page. A suggested donation amount can’t hurt either.
Successful online fundraising pages have strong starts.
Here are the FirstGiving facts:
Fundraisers who did not receive donations within 3 days of launch raise an average of $153 per campaign.
Fundraisers who receive donations within 3 days of launch raise an average of $408 per campaign.
2 easy ways your fundraisers can make the most of their first 3 campaign days
1. Fundraisers should be the first to donate to their online fundraising page
Make sure, whoever he or she may be, that they’re the first to donate to their page. It communicates commitment. Why would anyone contribute to a cause when the person asking for funds has yet to do so? This practice also sets the donation amount precedent. This keeps the fundraiser in control, don’t let another person set the donation bar. Will the first donation be $50? $60? You decide.
2. Have a “soft launch” for every online fundraising page
People want to be a part of a winning story. Before a fundraiser promotes an online fundraising page, make sure the “inner circle” has contributed. The “inner circle” are the people who, no matter the cause, will support a fundraiser’s actions. These individuals are mothers and fathers, brothers and sisters, girlfriends, boyfriends, etc. This way when an extended network lands on a fundraiser’s page, there’s already some significant funds in the bank. This is called “Social Motivation.” With funds already secured, a fundraiser communicates to their extended network that “it’s okay, donate to this page, look at all the people who already have...”
Hungry for more tips?
FirstGiving is happy to support Indiegogo during this year's International Women's Day. March 3-8, donate to a crowdfunding campaign on Indiegogo that empowers girls or woman and Indiegogo will match $1 for every $25 raised Monday, March 3rd and Saturday, March 8th. Learn more about Indiegogo's International Women's Day campaign.
International Women's Day celebrates the social, political and economic achievements of women while focusing global attention on areas requiring further action. Celebrated in over 100 countries, International Women’s Day is currently a national holiday in 35 countries.
Key International Woman's Day Indiegogo Dates
March 3 - $1 match for every $25 contributed to Indiegogo #WomensDay campaigns.
March 4 - "Women in Health" showcase of campaigns.
March 5 - "Women in Entertainment" showcase of campaigns.
March 6 - "Women for Change" showcase of campaigns.
March 7 - "Women in Tech" showcase of campaigns.
March 8 - $1 match for every $25 contributed to Indiegogo #WomensDay campaigns. (FAQ)
Promote International Woman’s Day by using the hashtag, #WomansDay. Indiegogo empowers people around the world to fund what matters to them. As the largest global crowdfunding platform, campaigns have launched from every country around the world with millions of dollars being distributed every week due to contributions made by the Indiegogo community. At its core, Indiegogo is the equal opportunity platform dedicated to democratizing the way people raise funds for any project – creative, entrepreneurial or cause-related.
You have a solid understanding of what peer-to-peer fundraising is, you’ve seen how other nonprofits have benefited from peer-to-peer fundraising, it’s finally time to calculate just how much extra fundraising revenue you’re capable of. (link to p2p calculator landing page) Let’s crunch some numbers!
Download our free Excel spreadsheet
We’ve pre-populated some numbers with FirstGiving averages but we encourage you to customize the spreadsheet with your nonprofit’s numbers. Your organization may have more fundraisers but less events, decide to charge for event registration but give donors the option to pay transaction fees. Every nonprofit is unique.
Let’s keep things simple and transparent
We’ve also broken down any sort of costs you may incur while using our service. If you’re surprised with how simple these equations are, it’s not by accident. We’ve built our entire platform to be as simple as humanly possible. Everything is laid out for you with 100% transparency.
Don’t forget about the intangible benefits either
Give it a try. Download our free FirstGiving peer-to-peer fundraising calculator and see what extra fundraising revenue your nonprofit can stand to make. Also keep in mind that this doesn’t take into consideration the numerous, intangible peer-to-peer fundraising benefits like:
- increased supporter engagement
- expanded donor list
- bolstered credibility
- smarter marketing
With the calculator, we’re simply analyzing the cold hard numbers.
Find out how peer-to-peer fundraising can boost fundraising revenue
In 2011, before Comfort Zone Camp was a leading example on how peer-to-peer fundraising could grow a mission and empower supporters to become fundraisers, the national organization was experiencing difficulty managing supporters through their donor database. Learn how they were able to overcome their difficulties by downloading this case study.
You'll learn how:
- Comfort Zone Camp empowered over 781 supporters to become fundraisers and cause ambassadors.
- Supporters' personal fundraising pages raised an average $498 each.
- FirstGiving powered Comfort Zone Camp's Grief Relief 5K.
- Comfort Zone Camp generated extra revenue through FirstGiving's event registration tool.
- Having fundraiser data in one place made communicating and tracking individual fundraisers progress easy.
“Raising money for Comfort Zone Camp was much easier than I originally thought, thanks to my generous family, friends, and coworkers. Seeing the donations coming in makes me want to raise even more money next year to help additional families in need!”
Comfort Zone Camp walker/fundraiser
Want to learn more about how Comfort Zone Camp benefited from peer-to-peer fundraising?
In only its second year, #GivingTuesday is changing the way nonprofits and everyday consumers understand the post Thanksgiving shopping frenzy. #GivingTuesday is a day of giving, a soul cleanser in a barrage of consumption of material goods. This special day reminds us that we can always do more for those who have less than us.
That’s why it gives us great pleasure to announce this year’s FirstGiving #GivingTuesday stats!
Here are some incredible FirstGiving #GivingTuesday stats
- In 2012, the average #GivingTuesday gift on FirstGiving was $72. In 2013, that number jumped to $84.
- In 2012, the #GivingTuesday mobile donation total on FirstGiving was $11,837.88. In 2013, the total leaped to $16,332.30.
- The 2012 FirstGiving #GivingTuesday donation grand total was $159,102.96. This year, we are proud to announce that $438,018.50 was raised in a single day.
Here’s to you guys and helping make the world a better place! We’re just happy you let us join you for the ride :)