Do You Earn Rewards on Charitable Donations?
This guide explains how donations earn rewards, how they fit welcome bonuses, and the fine points to keep in mind.
How donations earn rewards
A donation made with a credit card is processed as a purchase, so it earns your card’s rewards like any other charge, at the base rate or a bonus rate if the charity happens to code to a bonus category. There is nothing special you need to do; charging your regular giving simply turns it into points or cash back.
Using donations toward a welcome bonus
Because donations count as spending, they are a popular way to help reach a welcome bonus minimum, especially planned annual giving you would do anyway. Just be careful not to inflate your giving purely to chase a bonus, and remember the honest rule from do not let rewards change your spending.
The fine points
Two things to note. Some charities pass the card processing fee, often around two to three percent, on to you or ask you to cover it, which can cancel out your rewards, so check whether a fee applies. And earning rewards has no effect on your charitable tax deduction; you deduct the amount you gave, regardless of the points you earned, as our guide on whether rewards are taxable explains.
- Card donations generally earn rewards like normal purchases.
- They can help meet a welcome-bonus spend.
- Some charities pass on the processing fee.
- Rewards do not affect your gift’s tax deduction.
- Give what you would anyway; do not overspend for points.
Frequently asked questions
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