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First Time Donor Super Credit (FTDSC) in Human Speak - Shoebox-Be-Gone

First Time Donor Super Credit (FTSDC) – The Human Explanation

Today I had the opportunity to meet withJeff Hopper on CTV Ottawa Morning Live to talk about my best tax tips.  We talked about medical expenses, the new rules regarding income-generating websites and a few other things – but by far the most exciting one is the newly-implemented First Time Donor Super Credit. But what is it?  How do you know if you qualify?  And does it really make that much of a difference?

So what is it?

If eligible, it will add 25% to the federal charitable tax credit.  You may claim this ONCE in the tax years of 2013 through 2017.

Do I qualify?

Maybe!  If you meet the following criteria, you qualify to claim this credit in 2013:

  • You AND your spouse HAVE NOT claimed any charitable donations on your tax return for the past 5 years (2008 and beyond)
  • You are claiming charitable donations on this year’s tax return.
  • You OR your spouse can claim this credit, not both

What does it mean?

The first $1000 of monetary donations made after March 20th 2013 will be eligible for this tax credit.  The following examples are for a couple residing in Ontario:

If you donated $200 your credit will be $90 instead of $40 – a $50 difference

If you donated $500 your credit will be $286 instead of $161 – a $125 difference.

If you donated $1000 your credit will be $611 instead of $361 – a $250 difference.

If you donated $2000 your credit will be $1012.98 instead of $762.98 – a $250 difference

The CRA has a great online calculator – check it out!

So how do I maximize this?

Remember, you can hold on to donation receipts for up to 5 years.  If you only donated $20 in 2013 but plan on donating much more this year, hang on to that receipt, and claim it next year along with the FTDSC (if eligible) to get the biggest bang for your buck!

Side note: without the super credit, the first $200 of donations don’t give you much – the base is $40 in Ontario.  Anything above and beyond that is where you start seeing a significant difference.  Regardless of the super credit, hang on to donations and get a bigger tax credit once than a bunch of small ones 😉

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