Are Charitable Contributions Deductible as Business Expenses?

When a family child care provider makes a donation to her church, synagogue, or mosque she can claim this as a personal charitable deduction on IRS Form 1040 Schedule A Itemized Deductions. Likewise, with contributions of used clothing, toys, furniture, etc. to charitable organizations such as Goodwill or the Salvation Army.

Note: If you help out a parent by giving them a scholarship or donating money or items, you cannot claim this as a personal charitable contribution because the parent is not an IRS-qualified charity.

Charitable contributions are not, however, deductible as business expenses.

If you buy an ad in a newsletter or a special event program for a charitable organization you can deduct this as a business advertising expense. The same goes for paying money to sponsor a baseball or soccer team. In fact, any advertising for your business is deductible, whether or not the organization is a charity.

Parents who give you gifts of toys, supplies, furniture, etc. cannot claim a charitable contribution on their personal tax return. This is because you are not a qualified charitable organization. (Although it may feel sometimes like you are!)

See also my article, “What’s Not Deductible in Family Child Care?”

Image credit:

6a0133f3fc5805970b01bb08151dd5970d-320wiFor more information about what is deductible as a business expense, see my book Family Child Care Record Keeping Guide.

Categories: Deductions, Record Keeping & Taxes

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