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With the way things are going in the digital era there’s a whole lot you can do about donating to your favorite charities. In fact, with some new websites like Charity Navigator’s Giving Basket you can actually give donations entirely online. But what if you don’t have cash to donate or a way to give the money that’s necessary to give.
So, what can you do? Well, you don’t actually have to give just cash or even put money on your credit card. Instead, you can donate rewards points or cash back that you receive from your credit card company. You can even give things like miles or gift cards that you can earn through your credit card rewards program.
The great thing is that you can continue to make all of the same purchases that you always do and earn the same rewards you would otherwise. From there, you would be able to donate those things to your favorite charity or your favorite cause.
That’s going to make it easier for you to make a donation without having to come up with money entirely on your own. And all you need is a reward credit card in order to get yourself there. And you don’t have to have great credit in order to do it.
- Some credit card companies have an option to redeem credit card points and send them to charity, however, this service is not offered by all credit card companies.
- The actual terms of redeeming points vary, depending on the company. For example, American Express requires a minimum of 1,000 points. With this amount, customers can donate $10 to the charity of their choice.
- As a result of this process, the charity will either get the credit card points they can redeem or they might get a cash donation, depending on the credit card company.
- It is important to keep in mind that donated credit card points are not tax deductible. So if an individual wants to make donations tax deductible, then it is better to donate cash instead of credit card points.
What To Know Before You Donate Your Rewards?
Now, the process of making a donation with your rewards is a little different depending on what credit card you have and from what issuer. You may be able to go through the regular redemption process and send your rewards to charity or you may have to go through a separate process in order to send your money to the charity of your choice.
When you use your points for a charity or a nonprofit they’re able to use those points for different things depending on the needs of their organization. Organizations like the American Red Cross and the American Cancer Society or even UNICEF are able to buy the items that their organizations need to provide for their people.
Donating rewards will allow you to feel great about supporting the organizations that you really love. Not to mention it’s going to let those organizations get things that are extremely important to their operations.
And if they can’t use the points then they can generally convert them over to cash that can be used to buy additional supplies and materials as needed.
You may need to get a specific amount of points before you can redeem them for anything toward your donation. For example, American Express requires 1,000 points at a minimum and from there you can donate $10 to any organization you want. What’s even better is you can donate as much as you want of your points.
How To Set Automatic Donations?
It’s straightforward to donate your credit card rewards, but it’s becoming even more accessible thanks to some of the programs that credit card companies are starting to roll out
. They want to make it easier for you to donate your rewards as you earn them instead of having actually to redeem and donate them. All you have to do is make a purchase, and money will be donated to your favorite charity.
If you donate through Bank of America, for example, through the World Wildlife Fund card, you’ll be able to get bonus cash back, extra rewards, and more, and you’ll also get a donation to the World Wildlife Fund of 0.08% of all net purchases that you make with the card. There are even options for bonuses and extra donations.
The even more important thing about co-branded cards is that you can actually give automatic rewards, and then you can donate additional money as well. You can donate through the automatic option that offers a specific percentage for every purchase and also donate the rewards that you automatically earn.
Now, you’re not going to get a lot for the automatic donation, but you will get something and still get a little to give back through the rewards part of the process.
On the other hand, you could choose to get a high-quality rewards card that will allow you to donate your rewards to your favorite charity instead. That might give you more options and ensure that your favorite charity is getting even more.
Is It Worthwile To Make Donations?
The charity that you choose will get the points you have available or they will get cash for those points. It all depends on the specific organization as well as the specific credit card company that you are working with. But keep in mind that not all credit card companies offer the same things.
Sometimes you’re not going to get as much for your donation as you would if you redeemed the points for yourself. That means you need to think about what the options might be in different situations.
You’ll also want to look at how to make proper donations. If you do donate points through your credit card company you’re also not going to get a tax deduction. In case you wrote a check, on the other hand, you would be able to get a deduction.
If you turn your rewards into cash and give those to your favorite charity you’re going to be able to give them a bit more than you would otherwise. You’ll also be able to see just how much you’re giving and what those funds can do for your favorite charity.
Is a Donation Tax Deductible?
In general, if you donate points, you cannot deduct the donation from your taxes.
Now, there are some ways that you can deduct your donation, though they are generally going to be rare.
You can donate cash to your favorite charity if you redeem your points. That means they would be income, which means you would otherwise have to pay tax on them. When you donate the points themselves, you’re donating what’s considered a ‘discount,’ which means you don’t have to pay taxes at that point.
Where Can You Donate Your Card Rewards?
There are several different places where you can donate your credit card rewards and several other credit card companies that make it simple for you. These include:
1. Credit Card Plans
Here are a couple of plans the top issuers offer for those who want to donate their points or cash-back rewards:
With the American Express membership club you can donate through the JustGiving option and then you can select the different charities or fundraisers to that you want to send your money. You can even send the money to campaigns and different crowdfunding pages.
You’ll have access to just about any non-profit registered in the country and even several of international ones. Then you choose what you want and get started.
You’ll be able to donate a total of $10 for 1,000 points redeemed and you can donate up to 500,000 points per year. After you donate that much your rewards redemption is cut in half to only $5 per 1,000 points.
ThankYou® Points can be donated by cardholders who have Citi cards that earn them, such as the Citi Premier® Card and Citi Rewards+® Card.
Simply sign into your Citi ThankYou account and select “Charitable Contributions” from the “More Ways to Redeem” menu to use your Citi ThankYou points for charitable donations.
If you want to donate your points here you use the Cashback Bonus rewards system and give your donations to one of the many partners and organizations that are offered. You’ll also be contributing in other ways because if your chosen charity is the one to get the most donations throughout the year they’ll get a bonus $25,000 donation.
There are plenty of different options for who you can donate to, including the American Cancer Society, the American Red Cross, Junior Achievement, Children’s Miracle Network Hospitals, Operation Homefront, the Make-A-Wish Foundation and a whole lot more.
2. Donate Airline Miles
Several airlines and hotels also offer the option for you to redeem your points as a donation to your favorite charity. These include:
- Delta – You can choose from several dozen charities to donate your points to, and all you have to do is go to the Delta Miles donation page. From there, you can choose between domestic and international organizations.
- Jet Blue – You can get TrueBlue points for donating money to the American Red Cross. This is the only organization that offers this bonus, but it is something you should consider. Otherwise, you can donate to one of 18 different charities working in education, youth, community, or environmental areas domestically and abroad.
- American Airlines – If you’re an AA Advantage member, you can earn 250 points just for donating $50 or 500 AA miles if you donate $100, which will also go to the American Red Cross.
- United Airlines – Here, you can use the United Mileage Plus program to donate $50 to receive 250 bonus miles or $100 to earn 500 bonus miles.
- Marriott Bonvoy – With Marriott, you’ll be able to donate your points into several different categories. Though you don’t choose the exact organization or charity, you will be able to determine what categories are the most important to you and donate that way.
- IHG Rewards – You can donate 2,500, 5,000, or 10,000 points with this hotel chain. Then you can donate to several organizations, including Goodwill, the American Red Cross, and much more.
- Hilton Honors – With Hilton points, you can go through PointWorthy.com to donate your points to your favorite organization as a cash donation. All you need is a non-profit, registered organization in the United States.