The Tax Benefits of Donating to Habitat for Humanity
Habitat for Humanity is a 501(c)(3) organization, which means that all donations made to us are 100% tax-deductible. If you donate to a local Habitat for Humanity like the Dallas Area Habitat for Humanity, you will receive a receipt directly from our offices.
We provide receipts for both monetary and household donations. All household receipts will be made for the stated value of your donated items, which you will provide to us at the time of donation.
What Are Tax Deductions?
As with all donations to charitable organizations, any donation you make to Habitat is fully tax-deductible. This means that you can add the total value of your donations to Habitat for Humanity to your itemized deductions list.
Deductions are basically a way to balance out your income and lessen your tax burden. For instance, if you have to care for children, you’re given a deduction to give you some of your tax money back so you can continue to pay for their care. When you donate to charity, the government gives you a tax deduction to encourage you to continue giving to charity in the future.
Deductions effectively lower your taxable income so you can pay less in taxes and save the money for your own use.
Deductions Can Lower Your Taxable Income
In our tax system, there are several tax brackets. Those in higher tax brackets have to pay a higher percentage rate of taxes. This is where your deductions come in!
If you donate enough to Habitat to lower your taxable income to a lower tax bracket, you can save thousands of dollars on your next tax return.
For instance, if you had $50,000 in taxable income this year and you donated $30,000, your taxable income would become $20,000. This bumps you down a tax bracket and gives you a large chunk of money back. Just remember, you cannot deduct more than 60% of your adjusted gross income, so do the math carefully.
Deduct Donations of Household and Office Items
These deduction opportunities apply not just to monetary donations, but to household and item donations as well. When you donate gently used furniture, fixings, and appliances to the Habitat ReStore, you tell us how much they’re worth and we’ll write you a receipt for that amount.
You can then add that itemized receipt to your deduction list. If you’re remodeling your home or updating your office, this could easily add up to thousands of dollars worth of savings.
The Dallas Area Habitat recently had a local business, Hall Group, make a major donation of 43 semi-trucks worth of furniture. Donating to Habitat instead of having it hauled to the landfill saved them over $250,000 in hauling costs and gave them over $100,000 in tax breaks. That’s $350,000 saved altogether!
And in return, the money generated by those donations went directly into building homes for deserving families in our Dallas community. And we think that’s the best benefit of all. More families in affordable homes mean healthier, stronger, safer communities for us all.