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Tax Toolbox


Doing your taxes can be less frustrating, less time-consuming and less costly if you're prepared.

Charity begins at the state tax return
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Picking the programs
State legislators choose most charity check-offs, although the exact rules vary by state. California, for example, has a $250,000 threshold that charities must make in order to remain on the tax return, and some causes are listed on the returns for a limited time.

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"Some of the legislation for the check-off programs have sunset dates while others, as long as they can sustain minimum contributions, will be on the return each year," says Patrick Hill, a spokesman for the Franchise Tax Board, the administrative body for California income taxes.

States also tend to favor charity check-offs that aren't controversial. The most popular charity check-off is for protection of wildlife. And in states where hunting is popular, wildlife protection programs supported by the tax return check-offs specify that they only protect non-game animals.

California, with 14 check-offs on its 2005 tax return, has one of the larger programs. Taxpayers can donate to a variety of causes, ranging from funds for medical research (for example, breast cancer, Alzheimer's disease, prostate cancer) to those that support the needs of children, senior citizens, veterans and the ubiquitous rare and endangered species.

Economy, not donation method, affects giving
While the check-offs produce big money for some nonprofits, it doesn't protect them against economic pressures. Donations made via a tax return remain tied to the giver's financial circumstances, just like those made the more-traditional way.

Carla Snellgrove, a spokeswoman for the Alabama Department of Revenue, says her state's charitable contributions have gone up and down in tandem with the local economy. "The highs and low are probably tied to the economy," she says.

But check-off advocates on both the receiving and the tax-processing sides remain committed to the method.

"It's no secret that nonprofit and government agencies are facing severe budget cuts and reduced donations," said Barb Mattison, executive director of Colorado's Court Appointed Special Advocates in a press release.

"We decided to get creative," she noted, citing the state's publicity campaign. "By working together, we have a better chance of getting the word out that check-off giving is a simple, painless way to make a real difference for nearly every town and citizen in our state."

Jenny C. McCune is a contributing editor based in Montana.

-- Updated: Feb. 14, 2006
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