How to Determine if a Charity is Qualified to Receive Tax-Deductible Donations

Video Transcript

"People always asking you for money, me too. How to determine whether a charity is qualified to receive a charitable deduction is an interesting question. I'm Kristen Brand, I'm going to try to help you with that. You can't just give money to the kid on the corner with a lemonade stand. That's just being nice. The key to actually being able to deduct that money is to determine whether the charity has been qualified as a 501C3. These organizations have actually gone through a specific process with the IRS in order to be considered able to solicit these donations. They should actually be able to provide you with a letter that states that this is the case. Some examples were you may run into these are, churches, registered charities, hospitals, government units, public, publicly supported organizations. So these are the kinds of things that typically will have fund raising events. The boys and girls club, big brothers and big sisters, the kinds of places that typically are, are soliciting things in a more organized manner. So those are the kinds of things that you can look for. They should always be able to provide you with letter fast and typically, if the donation is over a hundred dollars, they're required to and you're also required to keep that documentation in order to deduct your taxes, in case anyone takes a closer look. I'm Kristen Brand and that's how to determine whether a charity is qualified for a tax deductible donation."