How to Maximize Your Charitable Contributions

By Miranda Marquit, on February 1, 2012

It seems that everywhere you turn, someone is asking for a donation. There are plenty of good causes out there, but there is no way for you to give to all of them — especially if your finances are tight. Instead of spreading your money thin, consider ways that you can maximize your charitable contributions so that they have a bigger impact. You might have to make some hard choices, but if you focus your priorities, you will find that you can really help accomplish some good.

Photo by HowardLake via Flickr

Choose an Effective Charity

One of the best ways to maximize your charitable contributions is to decide to give to causes and organizations that have a bigger impact, or that show their effectiveness. In order to figure out which charities are spending more on charitable programs (rather than paying huge salaries to executives), and which charities are using their resources more efficiently, you can turn to Charity Navigator.

Charity Navigator can help you figure out where your dollars will do the most good — and have more of an impact. Before you give, do a little research. Your money will go further if you give it to a charity that manages its funds well.

You can also look around your neighborhood for charitable giving ideas. Sometimes, you can see a bigger impact when you give to local charities. You can see the effects in your community every day. Consider local food banks, shelters and other charities. Smaller, community-based charities can make a huge difference locally — and provide you with a way to maximize your contributions. Look around your community and identify active charities that are involved and effective.

Donate More than Money

While your financial donations are definitely going to be appreciated, it is worth noting that you can maximize your charitable contributions in other ways as well. You don’t have to stick with just money. For those who might not have the financial resources to donate as much as they would like, being able to give in other ways can provide a real boost. Some of the ways that you can boost your charitable contributions without the need for money include:

• Volunteer your time: Spend some of your free time helping out. You can help at food banks, soup kitchens and shelters.
• Offer your expertise: If you have specific knowledge, you can offer that. Offer career counseling services and help at a local shelter. If you are an accountant, you can provide bookkeeping help free of charge. Advise a charity on social media strategies and fundraising. Think about what you have to offer in terms of professional knowledge and ability, and donate that to a good cause.
• Community development institutions: Many local communities have banks and credit unions that specifically focus on helping underserved populations. You can do your banking at these institutions, supporting them and their efforts.
• Donate your stuff: You can also donate your stuff to good causes, even if you don’t donate money. Donate toys to a children’s justice charity. Donate household goods and clothing to a thrift store that provides jobs to those who need them and low-cost items to the less fortunate. You can even donate items to a charity auction to help raise money.
• Coordinate a neighborhood drive: You can get your friends, family and neighbors involved as well by spearheading efforts. Coordinate food bank, thrift store and shelter drives to maximize the amount that is donated, and to increase your joint efforts.

Tax Benefits to Charitable Efforts

Not only can a little planning help you maximize your contributions to charities, but it can also ensure that you have your own financial benefit. Remember that your charitable efforts can be tax-deductible, reducing your income and what you owe.

You can, of course, deduct your financial contributions. You can also deduct the market value of goods that you donate — as long as they are in good shape. Make sure you get a receipt for the donation of money and goods. You can also deduct the mileage you drive as part of your charity work. For 2011, the amount was 14 cents per mile. Keep a good record of your mileage driven for charity, and use it to maximize your deductions.

Can you think of any other good ways to maximize your charitable contributions? Please share your story.

Leave Your Comment (5 Comments)

1. Thad P says:

   February 2, 2012 at 2:34 pm

   Of course charitable donations can be made to churches as well, many of which have very active ministries to the poor.

   Reply
2. Joe says:

   February 2, 2012 at 9:56 pm

   It makes me sick everytime that I see charities promoting lotto type fundraisers. Firstly, the cost of the prizes/promotion easily eat up 40-50% of the revenue. So for every buck I give to the charity, I’m only giving 50 cents. Then, I don’t get a tax refund so I can’t give nearly as much – a solid 25% loss on the original dollar (though this depends on your marginal tax rates). So I’m giving the charity about 30 cents on the dollar. People could be giving THREE TIMES as much if they were selfless and charitable, rather than greedy compulsive gamblers.

   Reply
3. Economically Humble says:

   February 8, 2012 at 11:59 pm

   Do you know if I can deduct services, such as designing a website for a group? I do this frequently and never have been able to give a solid answer. what records would I need to keep?

   Reply
4. Miranda Marquit says:

   February 9, 2012 at 10:19 am

   As far as I know, you can’t deduct the “value” of the time you work. You can deduct the value of the supplies you donate, and the mileage you drive, but you CAN’T figure up your hourly rate and then deduct the value of your services.

   Reply
5. Economically Humble says:

   February 9, 2012 at 1:49 pm

   Okay, so if a webpage were designed, I would need to figure out the value of the webpage, in order to deduct it, correct? I’ll do a little more looking around and see what I can find. Thank you very much for the follow up!

   Reply