Many people give to charity each
year during the holiday season. Remember, if you want to claim a tax
deduction for your gifts, you must itemize your deductions. There are
several tax rules that you should know about before you give. Here are
six tips from the IRS that you should keep in mind:
1. Qualified charities. You can only deduct gifts you give to qualified charities. Use the IRS Select Check tool
to see if the group you give to is qualified. Remember that you can
deduct donations you give to churches, synagogues, temples, mosques and
government agencies. This is true even if Select Check does not list
them in its database.
2. Monetary donations.
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.
Household items include furniture, furnishings, electronics, appliances
and linens. If you donate clothing and household items to charity they
generally must be in at least good used condition to claim a tax
deduction. If you claim a deduction of over $500 for an item it doesn’t
have to meet this standard if you include a qualified appraisal of the
item with your tax return.
4. 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. You
can 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 2014.
This is true even if you don’t pay the credit card bill until 2015.
Also, a check will count for 2014 as long as you mail it in 2014.
6. Special rules. Special rules apply if you give a car, boat or airplane to charity. For more information visit IRS.gov.
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