The website CharityNavigator.org provides an easy way for donors to figure real tax savings by figuring the tax benefits of donation and tax information into the site's calculator. The site asks for two pieces of data: donation amount and tax rate percentage.Continue Reading
A table shows users their tax percentage rate based on their yearly income. For example, a single person earning between $8,926 and $36,250 pays 15 percent of the income in taxes, as of 2015.
After the amount of the donation and the percent is entered, the user clicks on the Calculate button. The calculator then lets the user know the actual cost of the donation and the tax savings.
If a single person in the 15 percent income tax bracket donates $1,000 to charity, he receives $150 in tax savings for a net cost of only $850 for the donation.
Taxpayers must itemize deductions to take advantage of the donation. If the itemized deductions total less than the standard deduction, it's often best to just take the standard deduction.
Ninety-five percent of Americans donate to charitable causes, making an average yearly contribution of $2,974. While the tax benefits of donations are nice, other reasons to donate include improving one's sense of well-being, keeping informed of issues, strengthening spiritual life and building social circles.Learn more about Business & Finance