PRIEST RIVER — As Christmas nears and the 2016 calendar year draws to a close, the tax year is also winding down and with it, the chance to give generously to charities of one’s choice -- at a discount. Higher motives may draw donors to give, but Uncle Sam has sweetened the deal by offering incentives to charitable giving. Financial gifts to charitable organizations such as churches, humanitarian non-profits, and educational institutions, can cost less than their sticker price would indicate.

Newport certified public accountant Greg Jakeman advised people to give only if their hearts are in it. Otherwise, the donation will still cost you more than it’s worth in tax savings.

“If you’re at the 15 percent tax bracket, for every dollar you give, you save 15 cents. So if you’re looking to save on your taxes, don’t do it, because it’ll still cost you 85 cents. But if you give to charity because you want to give to charity, go ahead and do it because you’ve got a potential tax deduction as long as you can itemize.”

He said that many people without a mortgage don’t itemize their deductions because they can just take the standard deduction, which varies according to one’s filing status and whether the tax filer is 65 years or older.

Jakeman made the important observation that rules governing tax deductions on automobile donations changed in the last few years. Whereas it used to be that donors could deduct the Kelley Blue Book value of the donated car, now if people donate a car to charity, the donated car is worth what the charity gets for the car. So if the charity turns around and sells the car for $100, that’s all you can deduct for the donation. Jakeman said people who give non-cash donations should make sure to fill out Form 8283, and describe what you donated and to what organization you donated.

Lastly, if donors want to claim their gifts as deductions, Jakeman said people should check out a charity’s nonprofit status before giving. Many organizations fail to keep current with their paperwork and lose their charitable status with the IRS, he said. There’s one important caveat to that rule of thumb, though: organizations like historical societies are listed on the IRS’ 501(c)3 website, but churches are not, despite the fact that the IRS considers most contributions to religious organizations tax-deductible per IRS Publications 526 and 561 and Internal Revenue Code section 170(c).

According to the nonprofit organization watchdog website Charity Navigator, the cash value of your gift will cost less depending on your tax bracket.

“If the gifts are deductible, the actual cost of the donation is reduced by your tax savings. For example, if you are in the 33% tax bracket, the actual cost of a $100 donation is only $67 ($100 less the $33 tax savings). As your income tax bracket increases, the real cost of your charitable gift decreases, making contributions more attractive for those in higher brackets.

The actual cost to a person in the lowest bracket, 15%, for a $100 contribution is $85. For a person in the highest bracket, 35%, the actual cost is only $65. Not only can the wealthy afford to give more, but they receive a larger reward for giving.”

While the tax code may seem to advantage the wealthy, others benefit from their richer neighbors’ largesse.

The Chronicle of Philanthropy reported in 2014 that even despite a recession, wealthy Americans increased their giving to $77.5 billion in 2012 alone.

To find out if the charity of your choice is eligible to receive tax-deductible charitable contributions, go to https://apps.irs.gov/app/eos.

To contact Jakeman, call 509-447-1040 or go to www.jakemancpa.com.