Friday, February 12, 2010

Tip 23: Taxes and charity

I never dread tax time because we're still getting refunds. "But Stephanie, tax refunds are nothing more than interest-free loans to the government." Yes, I know. I suppose this is my nod to patriotism. I have no real secrets to tax filing except I'd say if you're married and filing jointly, do your taxes together by having one person read out numbers while the other enters them into the computer. This, of course, assumes you use Turbo Tax. I also love how Turbo Tax (we use Deluxe) saves your info from year to year (even though I clearly have the paper copies in my file). Matt and I hooked out this year's taxes in 35 minutes, and that's even with my tendency to triple check everything.

But when we did this year's taxes I made a new discovery...

Tip 23: Use Turbo Tax It's Deductible to determine the value of all your charitable donations.

I donate clothes at least twice a year to Goodwill. The nice Goodwill volunteer would give me a blank receipt, and even though I know exactly what I donated, I never could quite figure out its worth. How much for a pair of jeans? Boots? A T-shirt? That's why I love this ItsDeductible site. Enter your donated items and it automatically calculates their worth. And, believe it or not, it values the items at a higher dollar amount than I would have ever guessed. I suppose this is the classic case of one person's trash is another person's...well, you get the idea.

You can enter items by searching for them, or you can browse for them. I prefer the browse feature, in this case. Here's what the top portion of the Women's Clothing category screen looks like:

 

Once you've entered the number of donated items in each category that applies, it tallies the donation's Estimated Amount, and then it gives you a year-to-date Estimated Savings, or in other words how much you can expect back in your return. So if, for example, I donated one high-value jumper (I have no idea what that item would look like) and one high-value sundress, the Estimated Amount is $21 and the Estimated Savings from that donation is $5.25. Pretty cool, eh?

If you use Turbo Tax this information automatically imports into your account. Even if you choose not to use Turbo Tax when preparing your taxes, I still think this site could be great for tracking your charitable donations. Besides keeping track of donated items, you can also enter money, stock and mileage (driven in service of a charity).

Happy filing!

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