As the holidays approach, many children start to make wish lists, but unfortunately, not all children have someone to give them gifts. Luckily, there are many charities that help get holiday gifts and joy to children. If you're thinking about donating toys this holiday season, here is what you need to know.
Charities That Accept Toys
Various charities around the country accept used toys all year long. These include Goodwill, Salvation Army, and local thrift stores. Typically, these organizations sell the toys for a slightly reduced rate, and the proceeds go to support their missions.
Alternatively, you may want to contact churches, hospitals, or homeless shelters in your area. They may accept toys for children in their care to play with. With these charities, you should call in advance or check out their websites, rather than just showing up with a bag of toys.
Helping Children Get New Toys for the Holidays
If you want to make sure that a child in your community gets to open a present on Christmas morning, during the eight nights of Hanukkah, or on the holiday their family celebrates, you may want to look for a charity devoted to this mission.
Some great options include Toys for Tots, Catholic Charities Christmas Connection, United Way Christmas Bureau, and others. Alternatively, contact local groups in your area. For instance, many churches put up trees with the names and gift requests of children in the area.
If you want kids to get toys but you don't feel like walking through the aisles of your local toy store, you may want to consider making a cash donation to an organization that supports these efforts. Then, volunteers from the organization will turn your money into happy presents for children.
Are Toy Donations Tax Deductible?
You may be able to claim a tax deduction for giving toys to children. The Internal Revenue Service (IRS) allows you to claim a deduction for charitable contributions. This reduces your taxable income and can help to lower your tax liability.
To give you a simple example of how this works, imagine that you have $100,000 in income, but you donate $10,000 worth of toys. Theoretically, the donation lowers your taxable income to $90,000. Typically, you have to itemize to claim this deduction on your federal tax return, but even if you don't itemize, you may still be able to earn a state deduction.
If you donate toys, you can report the value of the toys as the contribution on your tax return. For instance, if you buy and donate $200 worth of toys, you may be able to claim a $200 deduction. This rule even applies to used toys. In that same vein, if you donate a bag of toys worth $100, you can claim that amount when calculating your potential deduction. Note that you can only claim deductions if the donation goes to a registered charity and you get a receipt.
The holidays are one of the best times of the year, but they can be stressful for families and children who are struggling financially. By donating toys, you can spread holiday joy to people in your community or around the world.
LPL Financial and these charitable organizations are not affiliates of each other and make no representation with respect to each other.
This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax advisor.
All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.