Charitable Donations
Charitable donations are not always tax-deductible donations. Please keep these rules in mind when submitting your donations with your tax return documents.
· Eligible charitable organizations can be found in IRS Publication 78. The link to search the publication:
http://www.irs.gov/app/pub-78/ . Only donations to these organizations are tax deductible. Donations to individuals, families or non-qualified organizations are not tax deductible.
· A record of the donation must be kept in order to deduct it. Acceptable records of monetary donations include a cancelled check, a bank, credit card, or telephone statement, a receipt from the organization, or a pay stub depending on how the donation was made.
· If a monetary donation of $250 or more is made at one time, then the organization must provide written acknowledgement of the donation.
· Up to $500 in non-cash donations can be deducted without itemizing the items donated. However, a receipt for the donation is still required.
· When total non-cash donations are between $500 and $5,000 in one year, the IRS requires more information:
o A description of the donated property
o The date the items were donated
o The fair market value of the donated items
For household items donated you can use estimated garage sale prices or the Salvation Army has a guide for household item values:
http://www.salvationarmysouth.org/valueguide.htm Please note that household items should be in good condition in order to receive a tax deduction for the value.
· Vehicle donations are limited to the lesser of the gross proceeds from the sale by the organization or the vehicle’s fair market value on the date of the donation. The organization will send a 1098-C form if the vehicle is immediately sold without any major improvements or if the fair market value of the vehicle is more than $500.
· For donated property worth more than $5,000, an appraisal is required to receive a deduction for the fair value of the property. Certain publically traded securities do not require an appraisal.
· Travel expenses can be deductible donations if the trip did not include any significant personal vacation. Examples would be mission trips or boy/girl scout trips.
· There is also a mileage deduction for any miles driven for charity purposes. The current charitable mileage rate is $0.14 per mile. A mileage log should be kept for charity miles driven.
We do not need copies of your receipts when you submit your tax return documents. A list of donations totaled by organization is all that should be reported on your tax return. You should keep your donation receipts and we recommend you keep them for five years.