Are Habitat for Humanity Donations Tax Deductible?
The Dallas Area Habitat for Humanity is a 501(c)(3) non-profit. This means that all donations made to Habitat are 100% tax-deductible. When you make a donation to your local Habitat for Humanity–whether monetary or in physical donations–you will receive a receipt for the value of your donation.
Receipts for monetary donations will be made in the amount of the donation. If you donate household goods to our ReStore, you will be given a receipt for the amount of the stated value of your donation.
How to Apply Your Tax Deduction
As with any other donation you make to a non-profit or charity, donations made to Habitat for Humanity are fully tax-deductible. This means you can add them to your itemized deductions when you complete your personal taxes for the year.
Deductions were created as a way to help lessen your tax burden and balance out the taxes paid from your income. The most well-known and frequently used deduction example is the “dependents” deduction. If you have children or other dependents that you care for, you can claim them on your taxes and get some of your money back to help pay for their care.
When you donate to Habitat and other charitable organizations, the government rewards and encourages this behavior by giving you a deduction on your taxes. This lowers your taxable income, allowing you to pay less in taxes and save that money for your own personal use.
Lower Your Taxable Income
Our tax system is arranged into several brackets that determine what percentage of your income you pay to the state and federal government. Deductions are taken out of your total taxable income, which can lower it significantly.
If you donate enough money to Habitat or other charitable organizations, this could lower you from one tax bracket to another. This means you may save not just the total amount of your deductions, but a higher percentage of your income overall.
For instance, if you make $100,000 in taxable income and your donate $30,000, your taxable income drops to $70,000. This bumps you into a lower tax bracket, saving you thousands of dollars. Just keep in mind that the IRS has a cap on donations. You cannot deduct more than 60% of your adjusted gross income.
Deducting Physical Household Donations
Deductions apply to the donation of physical items as well. As an individual, you can donate household goods such as furniture, appliances, construction materials, etc. As a company you can donate office furniture, finishings, etc.
When you donate your gently used items to the Habitat ReStore, you’ll tell them how much the items are worth, and they will write you a receipt for that amount. If you are unsure how much your items are worth, you can do research on comparable items online.
The receipt you are given by the ReStore can then be added to your itemized deduction list. If you’re renovating your kitchen or revamping your office, this could easily add up to thousands of dollars worth of deductions.
For instance, the Hall Group in Dallas recently donated over 43 semi-trucks worth of furniture to Habitat. Hauling it to the landfill would have cost them over $250,000. Instead, their donation garnered them $100,000 in tax deductions! That’s a total savings of over $350,000 dollars!
Benefit Your Community
When you make any kind of donation to the Dallas Area Habitat for Humanity, you are directly investing in the growth and prosperity of your community. All the profits and donations made by you go directly into building new homes for deserving families in the Dallas Area. If you’d like to make a donation today, use the donate now link here. Or visit our donations page to find the nearest ReStore donation dropoff center.
