Here are the facts about charitable giving and deductions for business taxes.
Tax deductions may be available for charitable contributions made by businesses to non-profit organizations.
Donating to charity is not about tax deductions. It’s because you feel connected to the organization. Giving charity is more than just receiving tax benefits.
It’s usually easier to talk to a tax advisor about the tax and paperwork requirements for charitable donations.
Donating to charity can have many benefits
Donating to charity can bring many benefits for businesses. Research causes that are important to your customers before you choose your charity. A child clothing retailer might find that their customers are more likely to respond positively if a portion of their payments goes to a charity for children. Here are some of the benefits that businesses can reap from regularly donating to charity.
Connecting with your local community
Let’s begin with the basics. Your business should consider giving to charity for a few reasons. Charitable giving can be a great PR tool and it is a good idea for businesses, especially small businesses that rely on their communities for support.
Kristen Fusaro – Pizzo, owner of Bath, Body, Candle Moments, stated that “small business is different from large-scale corporations” People want to shop at small businesses because they care about them individually and about the causes that matter to them.
Build your network
Charitable giving can also be a way of building alliances with other organizations or to network with potential partners. A local charity can help to establish a lasting relationship. [Read the related article: 6 ways to get involved in your local SMB community]
Kris Putnam-Walkerly is president of Putnam Consulting Group. She advises philanthropic firms on how to develop a lasting relationship with charities they support. Don’t limit your giving to the end-of-the year. Talk to the nonprofit to discuss ways that you can help throughout the year, including volunteering, sponsoring events, and inviting the CEO of the charity to speak to local business associations. Remember, this is a partnership. Ask the charity whether there are other ways that they could promote your support such as through their newsletters to donors.
Businesses can also benefit from donating to charities by improving their team morale. Your employees will feel proud to work for a charity that supports their company’s culture.
A charity that gives back to the community is likely to make customers feel good. Squareup claims that giving back can boost a company’s image, and lead to more loyal customers. Giving back to charity can also improve your brand’s image. According to the Center for Social Impact Communication millennials are very concerned about corporate social responsibility.
Donating to organizations that align with your business’s values
First, choose the right organization to donate. This will ensure that you get the most from your donations. A local organization is often a good choice for small businesses that are connected to the community.
Schweig stated that he tries to concentrate on smaller groups rather than large organizations because these are the ones that larger companies seem to overlook.