Monday, January 25, 2010

Don't Forget Non-Cash Charitable Contributions

Don’t forget non-cash charitable contributions as you prepare your tax return this year. Non-cash contributions include clothing, household goods, books, furniture, or other tangible items given to the Salvation Army, Goodwill, or other charitable organizations.

Generally, you can deduct contributions of property that you make to, or for the use of, a qualified organization. Not everyone, however, will be able to deduct their charitable contributions: you will need to itemize your tax deductions in order to claim this benefit.

In general, contributions of donated clothing and household items must be is in good used condition or better. Questionable items worth only a few dollars because they are in fair condition are no longer acceptable. Items not in good used condition must be accompanied by an appraisal.

Also, be sure to get a receipt or written acknowledgment from the charity for the donated goods for your personal records. The nonprofit may not put a dollar value on this receipt, but it will help you prove that you did indeed donate the property if the IRS asks. You are responsible for determining the fair-market value of any goods or services.

And if the total of all your contributed property comes to more than $500, you have to file IRS Form 8283 with your tax return. Above $5,000 and you must include an appraisal.

You can deduct your contributions only if you make them to a qualified organization. Donations to an individual, even if you feel the person is in need, are not tax deductible.

You can ask any organization whether it is a qualified organization, and most will be able to tell you. Or you can check IRS Publication 78, which lists most qualified organizations. You may find Publication 78 on the Internet at You can also call the IRS to find out if an organization is qualified at 877-829-5500.