Helpful Deduction Tips for Collectors

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Are you a collector? Have you ever wondered if you could donate the items you collect to a charity auction for tax break purposes? If you are considering this scenario, there are some things you should know.

The first thing you need to make sure of is that the charity you are considering is actually a qualified charity. Not all organizations qualify with the IRS for a charitable deduction. Make sure you check the list before you make your donation.

Another important step is to get your collectibles appraised before you make the donation. This can help you get the true value for your donation, which can mean a bigger tax break.

Next, you need to find out if your donation will actually produce any tax benefits for you. Charitable deductions are limited to 30 percent of your AGI, if they are capital gain property and you donate them to a publicly supported charity. On the other hand, if you donate to a private organization, the deduction amount drops to only 20 percent.

 Donating collectibles, like artwork for example can be a good way to get a few more deductions and save yourself a little more money on your tax bill. If you have any questions or need more clarification, then you can learn more by clicking here. You can also contact us at 1-877-CPA-2006.

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