Friday, February 01, 2008

Public Service: Tax Preparation Tips

Tax Preparation Tip #3: Don't give to charity. The paperwork is a mess. You can salve your conscience far more painlessly simply be realizing the a large portion of the dollar amount listed in Box 63 of the Form 1040 is, in fact, going to various corporate and lower income charities. Some large percentage of filers actually pay nothing and receive money back in the form of tax credits. If you simply must make charitable contributions, do it in a lump sum.

Do not do what I did, which was to make 20 individual contributions through the year, only two of which went to organizations that returned supporting paperwork. The rest required detailed and unprovable documentation. Helllooooo Auditors!

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