Give Thanks, Give Back, and Get a Tax Break

It’s the month to be thankful and we’re all about to eat our body weight in carbs and gratitude. But, before you jump into the family argument this year, let’s talk about how being thankful can impact your tax return. Yes, you read that right . . . you can be generous AND smart!

Reality Check: Not Everyone is Having a Feast

While you’re debating whether pie is a breakfast food (it definitely is), some families aren’t sure how they’re going to eat this week. With SNAP benefits suspended earlier this month, 41 million people are trying to figure this out.

What better time than Thanksgiving to share your love? Gratitude just hits harder when it’s shared.

Gratitude Without Action is Just a Hashtag

We’re all grateful for what we have and that comes to the forefront this month, but posting Insta pics of your loaded table isn’t the flex you think it is. And let’s face it, if you can afford a feast for the holidays, or to travel to see family, you’re better off than a lot of people. This isn’t a guilt-trip, but a reality check . . . and I know my clients are kind and giving people.

You don’t have to start a charity or give away a supermarket full of food to do some good. Just donating a few extra cans of food, taking a bag of items to your local food bank, or even volunteering to serve or deliver meals can be a huge help. And if you can’t do that, spread the word! Compassion is totally free!

Pro tip: Food banks love cash even more than canned potatoes, since they can stretch a dollar by buying in bulk.

Tax Time Tea (Psst, Generosity Looks Good on Your Tax Return!)

It’s great to help people but aside from the warm, fuzzy feeling you get in return, it’s also good for your tax return. Whenever you give to a qualified nonprofit, you can write it off come April. Whether you’re giving food or money, those good deeds may lighten your tax bill. Just make sure you keep the receipts and do a little research on where you’re donating, so you know the food bank is legit.

Donating money and food items is a pretty obvious write-off, but you can also deduct certain out-of-pocket expenses related to any volunteer work you do. If those expenses are directly connected to the charity activity you’re doing and are not reimbursed, you may be able to claim them as a deduction on your taxes. Depending on the situation, travel expenses, supplies, and mileage driven may count toward that dedication.

Stuff Your Heart, Not Just the Turkey

Obviously, helping people out isn’t about the deduction, but it is a nice bonus. Like the whipped cream on your pumpkin pie.

Be grateful, be generous, and let the IRS reward your good heart. You could be the reason someone gets to eat this holiday season.

Need to know more about how deductions work for you? Contact Ask Anna Tax for more information.