Comment by 0x457
16 hours ago
hmm, please correct me if I'm wrong, but donations just decrease your tax liability by the amount you've donated. It's the same as if you donated your pre-tax dollars to 501(c)(3) org.
16 hours ago
hmm, please correct me if I'm wrong, but donations just decrease your tax liability by the amount you've donated. It's the same as if you donated your pre-tax dollars to 501(c)(3) org.
The second sentence is mostly accurate, but the first implies something else.
If your taxable income was $50,000 and you donate $10,000, and (some other conditions) your taxable income would now be $40,000; same as if you managed to move the money pre-tax.
However. If you donate aprechiated capital assets, you get two benefits. Your taxable income is offset by the value of the asset, and the capital gains disappear. It's much better than selling the asset and donating the proceeds; and it's handy if you don't have good records for your cost basis.
Right but you get to choose where your money goes.