So You Want to Give—and Deduct. Let’s Do Both.

You started a business to make a difference, sure—but also to not get steamrolled by taxes. Enter charitable giving: the rare win-win where you can do good and keep the IRS from swiping quite as much of your hard-earned money. The catch? You have to do it right.

If you’re handing out cash like Oprah without a plan (“You get a check! You get a check!”), you’re probably missing out on serious deductions. So let’s fix that.

Step 1: Know What Actually Counts as Deductible

This is where most business owners get tripped up. Not all “giving” is deductible. That GoFundMe for someone’s vet bill? Sorry. Not deductible.

To qualify, your donation must go to a registered 501(c)(3) nonprofit. That includes:

• Religious organizations
• Public charities
• Educational institutions
• Scientific and literary nonprofits

Pro tip: Use the IRS’s Exempt Organizations tool to confirm a charity’s eligibility. If it’s not on the list, the deduction won’t fly.

Step 2: Give Through Your Business—But Smartly

Now here’s where strategy comes in. You’ve got two main paths:

1. Sole Proprietor, LLC, or S-Corp? In most cases, you’ll deduct the donation on your personal tax return. The business technically makes the donation, but the benefit flows through to you.
2. C-Corp? You can deduct donations directly on your corporate return—up to 10% of your taxable income (as of the latest rules).

In either case, don’t just make donations from your personal account and call it a day. Keep records clear. Business bank account, donation receipt, confirmation letter—keep the trail clean.

Step 3: Donate More Than Just Cash

Want to really leverage your giving? Go beyond cash. The IRS allows deductions for:

• Inventory (great for product-based businesses)
• Equipment (donate that old camera gear to a media nonprofit)
• Services (though tricky—your time isn’t deductible, but expenses related to donated services sometimes are)

If you’re in a product business, this is a goldmine. Donating excess inventory not only clears space but can be written off—just check with your accountant for proper valuation.

Step 4: Use a Platform That Doesn’t Eat Your Donations

Let’s talk platforms. Most online donation processors take 7–8% in fees, which stings when you’re trying to do good. That’s why platforms like Solafund.io exist. They only take 4.4%, meaning more of your donation actually reaches the charity—and you still get the deduction. Win-win. BUT – you need to talk to the organizations you give to and get them on Solafund first.

(Also, your accountant will thank you. Solafund offers clean receipts and reporting.)

Step 5: Bundle Donations Strategically

If you’re teetering on the edge of itemizing vs. taking the standard deduction, this move can help: bundle your giving.

Instead of giving $5,000 this year and $5,000 next year, give $10,000 in one year. That may push you past the standard deduction threshold and let you claim the whole thing.

Then take the standard deduction the following year. Rinse, repeat.

Step 6: Align Donations With Your Brand (and Get Some PR While You’re At It)

This is where giving gets strategic. Donate to causes your customers care about. Are you a pet brand? Support animal shelters. Run a tutoring service? Donate to literacy nonprofits.

Better yet, build campaigns around it. You’re allowed to feel good and get recognition. Highlight giving on your site, in your email newsletter, or in local press.

Just remember: it’s not a deductible expense if you’re getting advertising in return. That turns it into a marketing write-off, not a charitable deduction. Different line item, different deduction rules.

Step 7: Set It Up Systematically (So You Actually Follow Through)

Charitable giving sounds noble… until Q4 hits and you realize you forgot. Avoid this with automation:

• Pick one or two causes to support yearly
• Automate monthly donations from your business account
• Track everything in your accounting software or spreadsheet

If you want to budget for giving without losing control, set a fixed percentage (say, 2% of gross revenue) and include it in your quarterly planning.

Not sure how to organize all this without sharing financial access with your partner? This post on how to budget without sharing logins has a workaround that works for couples and biz partners alike.

One More Trick: Donor-Advised Funds (If You’re Playing Long-Term)

If you had a good year and want to lower your tax bill while planning future giving, consider a donor-advised fund (DAF). You can:

• Donate a lump sum now and get the deduction this year
• Distribute the money to charities later

DAFs are available through places like Schwab or Fidelity and offer flexibility—just know you’re giving the money away permanently (no take-backsies).

Final Thought: Give Generously, But Not Blindly

Charitable giving as a business owner isn’t just a feel-good checkbox—it’s a strategic tool. Use it wisely, and you’ll lower your tax burden, support causes that matter, and build a brand that actually does something good in the world.

Just make sure your generosity doesn’t outpace your bookkeeping. (And yes, you still need that receipt for the $1,000 you gave at the gala. Even if they gave you a weird tote bag.)

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Want to support a nonprofit without wasting money on fees? Tell them about Solafund—they only take 4.4%, so more of your gift actually gets there.