Key Term

What is Donation?

Definition

A donation is a voluntary gift or contribution of money, goods, services, or assets made to a charitable organization, nonprofit entity, or cause without expecting anything of material value in return. Donations can take many forms, including cash, securities, property, in-kind goods, or volunteer time, and are typically made to support charitable, educational, religious, or humanitarian purposes.

Significance

Donations are the lifeblood of charitable organizations and play a crucial role in addressing societal needs and advancing social causes. They enable nonprofits to carry out their missions, provide essential services, and create positive change in communities. For donors, making charitable contributions can offer significant tax benefits, create lasting social impact, and help establish a legacy of giving. Understanding different types of donations and their implications is essential for both donors and charitable organizations to maximize the effectiveness of philanthropic efforts and ensure compliance with relevant tax laws and regulations.