Happy Halloween tax breaks!

October 31, 2012

We're celebrating Oct. 31, but with a little thought, you can make today pay off on April 15, too.

Jack O Lanterns Halloween

Don't eat, donate: Did you one again overestimate the number of ghouls invading your neighborhood? You can get rid of the candy (without eating it yourself!) and possibly claim a tax break.

Take your unopened bags of Halloween treats to a local shelter. It's a great way to brighten the days of families who are spending some time there.

Or send your excess treats to solders stationed abroad. Operation Gratitude and Soldiers Angels accept such donations.

But make sure that the nonprofit you donate your excess treats to wants the gift.

And don't be tricked by organizations that aren't approved by the Internal Revenue Service. You can check any charity's status year-round via the IRS' online exempt organization search tool.

Costumes count: Did you buy all the kids new Halloween costumes this year? Don't just throw out the old ones. Give them to Goodwill or other nonprofits that accept clothing donations.

Giving your time: Don't be afraid to volunteer.

No, you don't get to count the value of your time that you spent cutting out paper ghosts or portraying a witch at your kids' school-sponsored haunted house.

But if you bought the paper used for the wraith paper dolls or to make the flyers that were used to promote the Halloween event and weren't reimbursed, you can claim that cost as a charitable donation.

Year-round donation rules apply: In addition to making sure that the group you choose is on the IRS' good-to-give list, be sure to follow all the other charitable tax rules.

Remember that you must itemize to claim any charitable deduction.

And you need to get a receipt for any gift you make. You don't necessarily have to send it to the IRS with your tax return, but if a tax examiner has questions later and you don't have documentation, you'll lose that tax deduction.

Halloween business tax breaks, too: Businesses aren't left out on this scariest holiday.

Did you give existing or potential clients a goody bag? As a smart business owner, in addition to filling it with fun-sized candies, you included a business card, a brochure of your company's products and/or services and some other small items with your business brand.

That's advertising and it's a deductible business expense.

Here's hoping that your Halloween is safe, fun and if any of these situations apply, tax-saving, too!

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