The holiday season often prompts people to give money or property to
charity. If you plan to give and want to claim a tax deduction, there are a few
tips you should know before you give. For instance, you must itemize your
deductions. Here are six more tips that you should keep in mind:
1. Give to qualified charities. You can only deduct
gifts you give to a qualified charity. Use the IRS Select
Check tool to see if the group you give to is qualified. You can deduct
gifts to churches, synagogues, temples, mosques and government agencies. This
is true even if Select Check does not list them in its database.
2. Keep a record of all cash gifts. Gifts of
money include those made in cash or by check, electronic funds transfer, credit
card and payroll deduction. You must have a bank record or a written statement from the charity to deduct any gift of money
on your tax return. This is true regardless of the amount of the gift. The
statement must show the name of the charity and the date and amount of the
contribution. Bank records include canceled checks, or bank, credit union and
credit card statements. If you give by payroll deductions, you should retain a
pay stub, a Form W-2 wage statement or other document from your employer. It
must show the total amount withheld for charity, along with the pledge card
showing the name of the charity.
3. Household goods must be in good condition.
Household items include furniture, furnishings, electronics, appliances and
linens. These items must be in at least good-used condition to claim on your
taxes. A deduction claimed of over $500 does not have to meet this standard if
you include a qualified appraisal of the item with your tax return.
4. Additional records required. You must get an acknowledgment from a charity for each deductible donation (either money or property) of
$250 or more. Additional rules apply to the statement for gifts of that amount.
This statement is in addition to the records required for deducting cash gifts.
However, one statement with all of the required information may meet both
requirements.
5. Year-end gifts. Deduct contributions in the
year you make them. If you charge your gift to a credit card before the end of
the year it will count for 2015. This is true even if you don’t pay the credit
card bill until 2016. Also, a check will count for 2015 as long as you mail it
in 2015.
6. Special rules. Special rules apply if you give a car, boat or airplane to charity. If you claim a
deduction of more than $500 for a noncash contribution, you will need to file
another form with your tax return. Use Form
8283, Noncash Charitable Contributions to report these gifts. For more on
these rules, visit IRS.gov.
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