Helping others can also help yourself with your taxes.  Here are seven ways to maximize your deductions:

1.    Load up on donations at year-end.  The holidays are a traditional time to give gifts to charity and with good reason.  Not only do you help a deserving cause, you get immediate tax gratification:  The gifts you give during the holiday season reduce your tax bill on April 15.  Note that charitable donations are deductible only if you itemize deductions.

2.    When in doubt, charge it.  Usually, you will make contributions to charities by check or in cash, but you can also charge donations via a valid credit card.  Any amount posted to your December bill is deductible on your return - even if you don't actually pay off the charge until the following year.

3.    Give away stock instead of cash.  If you have stocks or mutual funds that have accumulated unrealized gains, and you have owned them for more than one year, you can receive a charitable deduction for the full fair market value of the stock without paying tax on the capital gain.  The more unrealized gain you have in the security, the more this tax break is worth.  In effect, you are deducting an amount that would have been paid to the government as a capital gains tax.  

4.    Donate your old car to charity.  This deduction has been significantly reduced for 2005 by the American Jobs Creation Act of 2004 .  If the charity sells your car without making any significant improvements or repairs, your deduction is limited to the gross proceeds that the charity receives.  Since most charities wholesale or auction donated autos, your deduction may be limited to the salvage value of the auto rather than the fair market value that was allowed in prior years.  The new rules apply to vehicles with a claimed value in excess of $500.

5.    Be careful with gifts of art.  A special tax rule comes into play when you donate art or collectibles to a charity.  If the charity does not use the gift to further its tax-exempt function, your deduction is limited to the property's basis instead of its fair market value.  For example, if you donate a painting to your alma mater, you should specify in writing that the painting must be hung where students can easily view it and study it.

6.    Deduct expenses while doing volunteer work.  You are allowed to deduct the expenses incurred while performing volunteer work for a qualified organization.  For example, if you travel by car on behalf of a charity, you may deduct your charity-related auto expenses or take a standard deduction of 14 cents per mile.  Other deductible expenses include uniforms, supplies, meals and lodging, and all other expenses incurred on behalf of the charity.

7.    Don't forget the tax benefits of a fundraiser.  If you buy a raffle ticket, attend a charity ball, buy something in a silent auction, you are allowed to deduct, as a charitable donation, the difference between the amount you paid and the actual value of the goods or services you received.  For example, if you buy $100 of raffle tickets for an auto, and the statistical value of those tickets is $20, you are entitled to a deduction of $80.

CAUTIONS

    A.    You must have written substantiation for charitable gifts that exceed $250.  A cancelled check is not, by itself, acceptable.

    B.    If you donate property valued at $5,000 or more, you are required to obtain an appraisal by a qualified, licensed,  appraiser. 

    C.    Donations to political parties or candidates are not deductible.

   D.    If you gift is substantial, be sure that the charity is a qualified charity.  There are many non-profit organizations that are not qualified to receive deductible gives.