What is a Charitable Donation?

A charitable donation is any type of gift that is given to a private foundation, charity, or other type of non-profit organization. In many instances, the donation is in the form of cash. A charitable donation can also involve real estate holdings, cars or trucks, bonds or other types of securities, furniture and other household items, and even clothing. This type of giving is often a major source of support for various types of charitable organizations, since the gifts make it possible for the organizations to in turn offer their services to their target audiences.

It is possible to make a charitable donation in several different ways. The most common is to identify a charity or other non-profit organization that addresses a need considered very important by the benefactor. For example, an individual who has lost a loved one to cancer may choose to make regular cash donations to a charity that supports cancer research or provides support services to terminally ill cancer patients. In this scenario, the motivation is often to support efforts to overcome a disease or some other type of issue that causes a great deal of pain or suffering.

People who want to support some type of charitable effort, but have relatively little cash reserves to contribute often give items as a form of charitable donation. This often takes the form of donating clothing that is no longer needed, furniture that has been replaced with new items, or household appliances that are still in good working condition. Many charities accept these types of donations gladly, and are able to resell them in thrift shops as a means of generating revenue that can be used to further the cause adopted by the organization. In some cases, the gifts of furniture and large appliances also make it possible for a charity to offer employment to people who may find it difficult to obtain employment in other situations, owing to a physical or emotional disability.

In many nations, tax laws help to encourage this type of giving as a means of promoting social responsibility. People who itemize their expenses on tax returns can often obtain a tax credit for any resources freely given to various types of qualified non-profit organizations. The donations are usually documented in the form of receipts that are received directly from the charities. With cash donations, the receipts reflect the actual amount of money given during the tax period. For donations of clothing and other items, a reasonable estimated worth of the donated items is recorded on the receipt, making it possible to declare a specific monetary amount for each charitable donation made throughout the tax year.