Is it deductible?

Is it deductible? Charitable deductions are subject to rules and regulationsWhether a charitable contribution is deductible or not is subject to detailed rules and regulations, and can be a source of much confusion .



The money or property must be given to religious organizations, nonprofit schools, public charities or other groups listed by the IRS. Contributions given to individuals, dues, tuition and value of time or services are not deductible. If you receive goods or services for your contribution, only the amount exceeding the fair market value of the goods and services is deductible. Usually, the charity will provide a letter that specifies the value for the goods received.

Cash donations may be deducted if you have either a canceled check or written acknowledgment from the charity, documenting the amount and date of the contribution. Often, charitable contributions are overlooked as itemized deductions simply because you may neglect to review the checkbook register for any contributions made during the year. Spending a few minutes with your checkbook register can minimize the time spent looking through bank statements for the necessary canceled checks backup.

Maintaining good records throughout the year will help yield greater deductions at tax time. Although it's often more convenient simply to leave noncash donations, such as clothing, household items, books, and furniture, at an unattended drop site, taking the time to leave the items with someone often results in a larger deduction. When making noncash donations to the Salvation Army, Goodwill Industries or other such organizations, be sure to make a detailed list of the items you are contributing for your records. You can then place a value on each item based on a valuation guide. This will often result in a much higher deduction on your taxes, making the extra time well worth your effort.

Click on the links below to access the valuation guides:

The rules on donating motor vehicles are now slightly more complex and require additional documentation from the charity. Rules for donating appreciated property should also be carefully reviewed with your tax preparer. You may also qualify for other unique and specific deduction opportunities which Judy can review with you.

Call (603) 432-0310 for more information, and to schedule an appointment .

About Judy Murray, CPA