As the cryptocurrency market increases in value and popularity, charities and nonprofit organizations are beginning to accept crypto donations. If you’re a current crypto holder who is passionate about nonprofit causes, donating it offers significant tax deductions for you and even more benefits for your favorite organizations. Here are two ways to give crypto to the participating nonprofit or charity of your choice.
Simone’s Kids in Nakaseke, Uganda provides education and meets basic needs for children in order to help them break the cycle of poverty. We have big goals for 2022 and donating Cryptocurrency is one of the easiest tax-efficient ways to support the future of Simone’s Kids! To learn more about who we are and what we specifically do, check out our About Us page.
Give Through a Donor-Advised Fund
A donor-advised fund (DAF) is a public charity that works as a philanthropy management service. DAFs allow donors to make contributions, receive tax deductions, and recommend gifts to the organizations or causes of their choice. DAFs generally have the knowledge and capabilities needed for evaluating, receiving, processing, and liquidating crypto.
To donate crypto to a DAF, follow its instructions for doing so. First, select a crypto type and amount that you’ve owned and allowed to appreciate for over one year to avoid paying capital gains tax on it. Transfer it to your DAF and make recommendations as you normally would.
Give Directly to Charities Through Their Cryptocurrency Donation Platform
You can also donate crypto directly to a nonprofit or charity; for reference, consult this list of nonprofits and charities that accept cryptocurrency donations.
If your organization participates, check their website for a donation page, where you’ll find their crypto donation platform of choice. These platforms provide automated donation processing for charities. Currently, the most popular is The Giving Block, but similar ones include BitPay, Giveth, BitGive, Giftcoin, and others.
Using the platform, follow these general steps:
- Select the currency type and amount to donate.
- Fill out a form with basic information about yourself, including the email address you’d like your tax receipt sent to.
- Follow the instructions to transfer your crypto to the generated dynamic wallet address and confirm with the cryptocurrency donate button.
- Check your email for a tax receipt.
You can find additional ways to donate crypto here.