Tax Requirements for Charitable Contributions

When it comes to deducting charitable gifts, all donations are not created equal. As you file your 2015 return and plan your charitable giving for 2016, it’s important to keep in mind the following substantiation requirements for charitable contribution deductions:

CASH:

Less than $250:

  • Bank record, or
  • Written statement from charity (receipt) which should include the following:
  • Name and address of donee organization
  • Date and location of the contribution
  • Description of the property
  • FMV of the property

You must obtain this receipt at the time of the donation.

$250 or more:

  • Same as Less than $250, plus
  • A written acknowledgement from the charity that:
  • Describes what was donated and when, and
  • States that no goods or services were rendered in return for the donation, or describes and values what the charity provided in return

You must obtain this acknowledgement by the time the tax return, for the year of the donation, is filed or due, whichever comes first.

NON-CASH:

Less than $250:

  • Written statement from charity (receipt)

You must obtain this receipt at the time of the donation.

$250- $500

  • Same as Less than $250, plus
  • A written acknowledgement from the charity describing what was donated and when, and stating that no goods or services were rendered in return for the donation, or describing and valuing what the charity provided in return.

You must obtain this acknowledgement by the time the tax return, for the year of the donation, is filed or due, whichever comes first.

$500 – $5,000

  • Same as $250 – $500, plus
  • Documentation with:
  • Date each item was acquired
  • Actual amount or estimate of the item’s purchase price
  • Reasonably detailed description of the donation property along with its condition
  • Description of the item’s current retail value (usually second-hand or thrift-store)
  • Explanation how current retail value was determined (for example, https://www.irs.gov/publications/p561)

$5,000 or more (same or similar items, except publicly traded securities)

  • Same as $500 – $5,000, plus
  • Appraisal by a qualified appraiser, and
  • Declaration of Appraiser and Donee Acknowledgment (Form 8283, Section B)

You must have your appraisal done by a qualified appraiser no earlier than 60 days before the contribution and received no later than the time the tax return, for the year of the donation, is filed or due, whichever comes first.

If you have any questions regarding the information in this article, please contact our office at 703.385.8888 or .

© 2016


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