We are nearing the end of the tax year and it’s time for your last minute charitable donations.  If you are planning on taking a charitable deduction via Schedule A and wanting to donate property “non-cash” items, here are the rules:

  1.  The organization receiving your donation must be qualified:  religious, charitable, educational, scientific, literary, or prevention of cruelty to kids/animals.
  2.  For all non-cash contributions you need to keep documentation regarding the donation detailing:
    1. name of organization
    2. date/location of contribution
    3. description of property
  3. Non-Cash donations fall under 4 categories:
    1. under $250:  all the above info and how you arrived at the value
    2. over $250 and less than $500:  all the above with receipt from organization
    3. over $500 and less than $5000:  all the above + receipt from org + records that include how your acquired property, when and the cost
    4. over $5000:  everything included in items 1-3 above + qualified written appraisal of property.

Bottom line, even if you drop off goods at Goodwill you will need a receipt, description and valuation.  The IRS has disqualified charitable donations because of lack of taxpayer documentation/records so make sure you can substantiate all your donations.

NOTE:  Take a picture when you drop off goods and put that in your files as another record.

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James A. Daniel

James A. Daniel - Financial Planner

CFP, CFA, CMT

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