Income Tax Exemption in the USA: How does it work?

26 U.S.C. § 170 provides a deduction for federal income taxpurposes, for specific donors whomake charitable contributions to most of the 501(c)(3) organizations, among others.

Are you a 501 (c)(3) organization?

Yes, Narayan SewaSansthan Inc. is a 501(c)(3) organization. The tax-deductibility of donations is one of the provisions unique to Section 501(c)(3) organizations as opposed to other tax-exempt entities.

What tax exemption benefit do I get?

The tax benefit is up to 1/3rd of the total income for an individual. Companies, on the other hand, get tax benefits for every donation that is made to the registered organization, provided their claim is not more than their total annual net income.

When are tax benefits applicable?

Tax benefits are applicable when the donation has been made. The donation should have been made to a registered organization and the applicant should have proper paperwork for the same.