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wallstreetesq., Attorney
Category: Business Law
Satisfied Customers: 17080
Experience:  10 years, Corp litigation, Of Counsel to several global and nationwide corporation
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I am a U.S. citizen residing in Texas and I have an offshore

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I am a U.S. citizen residing in Texas and I have an offshore LLC which I am the sole member/owner. A certain percentage of the profits of my LLC, I would like to donate to charities in the U.S.

1) What would be the best way for me to donate in order to maixmize my tax return? Example: have the offshore LLC donate directly to charity in its own name, or transfer the funds from the LLC to my personal (domestic) bank account and donate to charity in my name?

2) Is the offshore LLC able to claim a tax deduction if it makes a charitable donation in its name?

Again, I'm looking for the best way to make charitable contributions that would maximize my return (or minimize what I owe) every year...given the setup that I have
Submitted: 7 years ago.
Category: Business Law
Expert:  wallstreetesq. replied 7 years ago.
-Could you explain your situation a little more?
Customer: replied 7 years ago.

The LLC will be considered a "pass through entity" for filing purposes: I will be filing form 8832 and checking the box "A foreign eligible entity with a single owner electing to be disregarded as a separate entity"


So, the way I will report the profits (or losses) of the company will be on my personal 1040 Schedule C...

Expert:  wallstreetesq. replied 7 years ago.
if reporting the profits and losses on your own return, you can claim the charitable deductions on your return.
If your LLC is a corporation then the corporation may deduct the contributions up to 10% of the business taxable income.

The tax deduction for charitable contributions generally is limited to 50% of your adjusted gross income (AGI). Which in your case is the LLC gross.

The deduction for appreciated property is limited to 30% of your AGI if you choose to deduct the fair market value of the property or 50% if you choose to deduct the basis of the property. The 30% limit also applies to charity donations of property to certain organizations, such as veterans' organizations, fraternal societies, nonprofit cemeteries, and certain private nonoperating foundations, and to donations of property for the use of an organization. A 20% limit applies to gifts of capital gain property to or for the use of an organization subject to the 30% limit. Contributions in excess of the limit can be carried forward for up to 5 years.
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