If you live in Virginia and are searching for charitable organizations to give to, you may want to consider the Neighborhood Assistance Program (NAP). This program reviews applications from 501(c)(3) organizations following a strict criteria list that ensures your donation is well spent.
Special Tax Benefits
There is also pretty large tax incentives to donate to these charities. You may receive a state tax credit of 65% of the donation. However, there is typically an application process for these credits since it is a limited amount. In our experience, it is best to apply within the first week the application process is open.
Example - John donates $4,000 to a food bank. If approved, he may receive a credit to reduce his state taxes by $2,600 ($4,000 x 65% credit). In addition, he can also deduct it from his federal taxes and he is in the 24% tax bracket, reducing his federal taxes by $960 ($4,000 x 24%). For his $4,000 donation, he has received back $3,650 in tax benefit. He has provided a $4,000 donation for only $350 ($4,000 donation - $3,650 benefit).
For a list of approved organizations, go to https://www.dss.virginia.gov/community/nap.cgi
Disclaimer: Alex Voorhees and Reston Wealth Management do not provide legal, accounting or tax advice. This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified investment, tax or legal advisor. The opinions voiced in this article are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which investment(s) or strategies may be appropriate for you, consult your financial advisor prior to investing. No strategy assures success or protects against loss. You should consider the investment objectives, risks, charges and expenses of any investment carefully before investing.