Charitable contributions made to a qualified organization may help to
lower a tax bill. To help ensure your contribution is deductible, pay
attention to the following reminders.
Your contribution must be to a qualified organization, check with the
organization to ensure your contribution is tax deductible. If you give
to a specific individual, a political organization or to political
candidates, your contribution is not a tax deduction. If you receive a
benefit from your contribution, such as a dinner, merchandise, tickets
to a sporting event or concert, or any other service or goods, then you
are only allowed to deduct the amount of your contribution that exceeds
the fair market value of the benefit you received.
Stock or any other non-cash donation is valued at the fair market value
of the property. Clothing or household items must be in good used
condition to be deductible. Vehicles have special rules that requires
the receiving organization to provide you with documentation showing the
value received by that organization.
Regardless of the amount contributed, to deduct cash, check or other
monetary gift then you must maintain a bank record of the contribution,
a payroll deduction record or some form of written communication from
the organization that shows the date and the amount of the contribution.
Special rules do apply if you contribute non-cash items totaling $500 or
more. Additionally, if the goods total $5000 or more an appraisal might
be required.
