Australia Finance

Aug 29 2017

Donation Valuation Guide #charitable #auto #donations


#

How to get a tax deduction for charitable donations

JGI/Jamie Grill/Getty Images

Giving away your stuff that no longer brings you joy may instead bring happiness to others who could use them. An added bonus: You get a tax deduction for your charitable donations if you itemize deductions.

However, it’s your job to keep track of the items you give to charity so you can report their value to the Internal Revenue Service. The IRS says donated clothing and other household goods must be “in good used condition or better.” If you claim a deduction of $500 or more for a used item that’s not in good condition, the IRS says you’d better get an appraisal.

Several computer software programs are available to help you figure the tax value of your donated stuff. The list of some common items, below, gives you an idea of what your donated clothing and household goods are worth, as suggested in the Salvation Army’s valuation guide .

Men’s clothing worksheet

You don’t have to send in a list of donated items with your return. Simply keep the information with your personal tax records and put the total contribution amount on your Schedule A, Itemized Deductions (or your computer software will do it for you).

Be sure to get a receipt from the charity when you donate your goods — again, for your personal records. The nonprofit won’t put a dollar value on the receipt, but the paperwork will help you prove that you did indeed donate the property, if the IRS asks.

If you make a single noncash gift worth between $250 and $500 (if, for example, you donate a vehicle), you’re required to have a receipt or a written acknowledgment of your gift from the qualified charitable organization.

(If you’re thinking of getting a new vehicle so you can donate your old one and get the deduction, check out auto loan rates at Bankrate.)

If the total of all your contributed property comes to more than $500, you have to file IRS Form 8283 with your tax return.

How much do you owe the IRS (or how big will your tax refund be)? Use Bankrate’s 1040 Tax Estimator to find out!

Veteran tax journalist Kay Bell writes tax stories from her Austin, Texas, home. She also blogs at Don’t Mess With Taxes. She is the author of the book “The Truth About Paying Fewer Taxes,” and a co-author of the book “Future Millionaires’ Guidebook.”

How we make money

Bankrate.com is an independent, advertising-supported publisher and comparison service. Bankrate is compensated in exchange for featured placement of sponsored products and services, or your clicking on links posted on this website. This compensation may impact how, where and in what order products appear. Bankrate.com does not include all companies or all available products.

2017 Bankrate, LLC All Rights Reserved.

Maximize Your Money. Get Expert Advice Tools. Master Life’s Financial Journey.

You have money questions. Bankrate has answers. Our experts have been helping you master your money for four decades.

Our tools, rates and advice help no matter where you are on life’s financial journey.


Written by admin


Leave a Reply

Your email address will not be published. Required fields are marked *