Donating to a charity is a great way to support a worthy cause that you believe in. And with the rise of cryptocurrency, you don’t necessarily have to go the traditional route of using dollars or other fiat currencies. Instead, you can donate Bitcoins or any other cryptocurrencies you might have.
As more and more people start investing in crypto, cryptocurrency donations are becoming increasingly popular among individuals and organizations. And the truth is, crypto donation options actually come with a few significant benefits.
But how can you donate crypto such as Bitcoin or Ethereum? And what are the benefits of doing so? Let’s go through everything you need to know about crypto charity donations below.
Can You Donate Bitcoin or Other Cryptos?
Before we can move into the details about the process and potential benefits of giving and accepting cryptocurrency donations, we must first answer the initial question of whether you can donate Bitcoins or other cryptocurrencies in the first place.
The good news is that not only is it possible, but there are many foundations and charities that accept cryptocurrency. Even though cryptocurrency was a novelty not too long ago, it’s now a government-recognized investment that has exemptions aimed at making it easier to donate.
Benefits of Donating Cryptocurrency to Charity
One of the main reasons that people are hesitant about crypto charity donations is the fact that they can result in having to pay capital gains tax. Or at least, that’s how it used to be.
Before you could donate cryptocurrency to charity, you needed to sell your Bitcoin or other cryptocurrencies, pay the capital gains taxes you owe the government, and then donate the remaining amount to a charity. Because of obvious reasons, this model was not ideal, as it took away a significant portion of the donation from the charity you wanted to support.
But by being able to donate Bitcoins and other cryptocurrencies directly, you don’t have to sell them beforehand. And you can even get a tax deduction that’s equal to the fair market value of the donated cryptocurrency, which is determined by an appraisal.
This way, instead of paying a partial amount left after capital gains taxes, the charity can receive the full value and use it to further its cause, making each donation go further than it otherwise would.
When you choose to make a crypto donation, you can save on capital gains taxes, transferring the savings to the charity and giving more than you would be able to otherwise.
How to Donate Cryptocurrency to Charity
At this point, it’s clear that you can donate Bitcoins, and it actually makes sense because the cryptocurrency donation is tax-deductible. But what does the process of donating cryptocurrency to charity look like?
Let’s go over each step below, using Save The Music as an example:
1. First, you will need to go to our Engiven platform page, which is a secure and trusted third-party vendor that allows us and other nonprofits to safely receive cryptocurrency donations, converting them to U.S. Dollars that we can use.
2. You will need to choose the cryptocurrency you want to donate in and select how much of it you want to give. Engiven makes it very convenient, providing you with an instant calculation of how much your donation will be worth in U.S. Dollars.
3. Then, you will need to input your information that will be used to provide us with your data and also create a valid tax receipt for the gift. None of the information will be made public.
4. Finally, you will be taken to the next page, where a QR code will be generated that you can use with your wallet. It contains the address to send the selected amount to Save The Music. You can also use a generated public address for the same purpose.
5. Once the gift is processed, you will receive a receipt to your email address. At this point, the transaction is complete, and you can close the page.
As you can see, the entire process is incredibly simple and convenient and doesn’t require any technical skills or complex operations. What’s more, since we’re using a trusted vendor, you can be sure that your data and personal information remain secure, making crypto donations a safe and easy choice. If you’re not comfortable donating Bitcoin, donate using one of our ways to donate.
Crypto Donation FAQs
At this point, we have gone through the main aspects of how you can donate Bitcoins or other cryptocurrencies to Save The Music. But if you want to learn more or have questions, here are some of the Frequently Asked Questions that might be helpful:
Is a crypto donation tax-deductible?
As mentioned before, cryptocurrency donations are tax-deductible, as you can be exempt from paying capital gains tax for the fair market value of the donated Bitcoin or another cryptocurrency.
Do all charities accept crypto?
Even though not all charities accept crypto donations at this time, the list of charities that accept cryptocurrency is growing every day. And Save the Music is already accepting cryptocurrency donations through the secure and trusted Engiven platform.
Is accepting cryptocurrency legal for nonprofits?
Yes, it has been legal since 2014, as Bitcoin is treated as property for tax purposes.
Which cryptocurrencies are the most popular for donations?
Since Bitcoin is the most popular cryptocurrency in the world, it’s only natural that it makes up the vast majority of donations as of today. But with other cryptocurrencies such as Ethereum becoming more popular, the number of other cryptocurrency donations is set to increase.
If you want to donate Bitcoin to your favorite charity, it’s now easier and more secure than ever. And at Save the Music, we strive to make donating crypto easy and convenient while also ensuring that you get the tax exemptions just as with stocks.
At Save the Music, we believe that the benefits of music education have the power to help young people succeed in school, build self-confidence, and foster leadership skills. If you want to learn more about our music foundation’s mission to jumpstart music programs in public schools, or if you have more questions about donating using cryptocurrency, reach out to us today!