Charitable deductions can be a complex and confusing area of your tax return. Understanding what you can deduct and what you can’t deduct can be confusing. Documenting it properly adds yet another layer of difficulty. To help sort it all out, I talked to Kelly Erb, (a.k.a. Taxgirl), and Kay Bell (of Don’t Mess With Taxes).
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- Erb is a tax attorney who runs her own tax law firm with her husband. She’s also been blogging about taxes for the past six years. Before striking out on her own, she clerked for the IRS, specializing in estate and gift taxes. She also worked for a boutique law firm that primarily handled estates and gifts.
- Bell is the author of The Truth About Paying Fewer Taxes, and the founding editor of Bankrate’s tax section. She has worked on Capital Hill with the House Ways and Means committee.
Both women offered great tips for getting the most from your charitable deductions while taking care to avoid pitfalls that could get your return flagged.
Should You Be Taking Charitable Deductions?
Most people give at least some money to charity, but few of us take our charitable deductions. In fact, only about a third of households itemize their deductions. The rest simply take the standard deduction, which for the 2010 tax year is: