IRS Charitable Contribution Tips
In IR-2016-50 the IRS reminded taxpayers to follow appropriate charitable contribution guidelines.
1. Records
For gifts of $250 or more, you need a contemporaneous written acknowledgement. Most donors will call this a receipt. It usually states that “No goods or services were provided in exchange for the gift.” If you are giving property, you also will want to retain a record with a description of the property.
2. Vehicles
If the value of a car, boat, RV or other vehicle exceeds $500, then IRS Form 1098-C will be necessary. Generally, your charitable deduction will be equal to the gross proceeds received by the charity when it sells the vehicle. An exception is made for a related use of a vehicle by a charity or a material improvement prior to sale.
3. Property over $500
IRS Form 8283 is required for property gifts valued over $500. You will need information such as the date it was acquired and the property description.
4. Property over $5,000
Form 8283 is also required and it must be signed by the charitable organization and a qualified appraiser. The appraiser must have a specific designation or sufficient experience in the type of property being appraised. An exception to the appraisal rule is made for publicly traded securities. Stocks are valued at the mean between bid and ask on the date of the gift or the value at the end of the business day for mutual funds. No appraisal is required for public securities.
5. Clothing and Household Goods
These must be in “good used condition or better.” The category includes furniture, furnishings, electronics and appliances. If the items are valued over $500, you may obtain an appraisal.
6. Gifts of Money
A bank or credit union record is required for gifts of any amount. You should have a record with name of the charity, the date and the amount gifted. Payroll gifts may be supported with a W-2 document.
7. Timing
Gifts must be delivered to a charitable organization or placed in the U.S. Mail by December 31. Gifts by credit card are deductible if made by December 31, even if the payment is made in January.
