Tax Preparer Certification Assures That Unusual Charitable Deductions Are Not Missed

Tax Preparer Certification Assures That Unusual Charitable Deductions Are Not Missed

One of the advantages individuals experience from using the services of someone with tax preparer certification is the capturing of uncommon income tax deductions. Taxpayers who itemize deductions benefit from uncovering all of their available tax-deductible amounts. Without professional assistance, taxpayers commonly forget to consider every possible deduction they incurred.

The benefit provided by professionals who completed tax preparer study is their knowledge about all types of tax deductions. For example, most taxpayers think that their charitable deductions are only checks they wrote to charities and donations of clothing or furniture to Goodwill. These people are cheating themselves by failing to obtain advice from a paid tax preparer.

There are several ways for a taxpayer to record additional charitable deductions. One common situation is mileage driven for volunteer work. There is no need to account for actual vehicle costs. Instead, there is a standard mileage rate for charity miles driven. This rate is adjusted every year for the cost-of-living. But tax return preparers are always aware of the latest changes from completion of their annual online continuing education credits.

All that is required for deducting charitable mileage is the date and purpose of each trip along with the number of miles. Any parking fees or tolls paid are added to the figure determined using the standard mileage rate. Even one trip for a church project is worth counting. Multiple recurring trips are easily calculated when the locations remain the same – thus making the number of miles constant for each trip.

When volunteer activities occur there are often associated out-of-pocket expenses that become tax deductions. These include any clothing uniforms, such as hospital volunteers may purchase. In addition, a volunteer may purchase snacks or drinks for charitable youth group events or buy stamps for mailings of a charitable organization.

Tax professionals with registered preparer training are also proficient in the treatment of charitable gifts of appreciated property. A growing number of charities have established programs for accepting such donations.

Charitable giving of appreciated property enables the taxpayer to avoid paying capital gain tax from selling the assets in order to donate cash. When appreciated property is given directly to the charity, the taxpayer receives a tax deduction for the asset value. The charity can sell the asset and incur no capital gain tax because it is a tax-exempt organization. But the assets must have been held for the long-term period of more than one year. Giving property held for one year or less reduces the tax deduction to the taxpayer’s cost.

Anyone who wants to obtain an extra charitable deduction and is feeling patriotic can send money to the Bureau of Public Debt. This payment reduces the amount borrowed by the US Treasury. Uncle Sam helps cover some of the cost by permitting a charitable deduction for the amount sent.

IRS Circular 230 Disclosure

Pursuant to the requirements of the Internal Revenue Service Circular 230, we inform you that, to the extent any advice relating to a Federal tax issue is contained in this communication, including in any attachments, it was not written or intended to be used, and cannot be used, for the purpose of (a) avoiding any tax related penalties that may be imposed on you or any other person under the Internal Revenue Code, or (b) promoting, marketing or recommending to another person any transaction or matter addressed in this communication.