Gifting the Government
By Dian Vujovich
There’s still time to capture some tax-deductible write-offs this year. If you’re stuck for ideas, how about helping out the Uncle or any of his cousins.
We American’s are a generous lot. In addition to paying taxes some of us don’t mind giving some of our hard-earned cash to local services, such as our police and fire departments, or even the U.S. government. While the reward for doing so can be a warm and fuzzy feeling in our hearts, there are also tax benefits.
Doug Resetar, at Rampell & Rampell, provided me with the bottom-line scoops on financial gifts given to the government, any state, or even Indian tribes and the deal is: to be tax-deductible, the contribution must be made only for public purposes—like contributing to the Treasury Department to pay down our debt or the Social Security Trust fund.
According to recent CNNMoney.com story, last year’s donations earmarked to help reduce our debt amounted to over $3 million. The year folks were the most generous in helping was 1994 when over $21 million came in. Ten years later, generosity was down considerably—contributions in 2004 amounted to only $665,000. (More information about gifting and the amounts given to the Bureau of the Public Debt can be found at: http://www.savingsbonds.gov/govt/reports/pd/gift/gift.htm .)
If you’d like to help reduce our whopping debt load and get a deduction this calendar year, send your check to the Treasury Department, Attn: Dept G, Bureau of the Public Debt, P.O. Box 2188, Parkersburg, WV 26106-2188. Make sure it’s postmarked no later than December 31.
Don’t forget to keep a good record of your actions. So to be safe, why not write something like ‘tax-deductible gift” in the “memo” section of the check. That ought to help should you be one of the lucky 2 percent of taxpayers likely to have their tax returns audited next year.
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