Donate Yourself a Deduction

You are able to deduct donations you made to charity if you itemize your deductions when you file your taxes.

In order for your donations to be eligible for deduction, all of your contributions have to be made to qualified organizations. You can never deduct money you’ve paid to an individual. The IRS has set special boundaries to determine which organizations qualify for tax deductible donations.

Charitable contributions are only deductible past the fair market value of any goods or services you receive in exchange, such as merchandise or admission to a banquet, performance, or event.

If you donate cash, check or some other form of a monetary gift in any amount, you have to receive a receipt or some other form of documentation from either the bank or the organization to whom you made the donation. The receipt should have the date, amount, and the charity’s name listed on it. You are typically also able to deduct the fair market value of any property or good that you donate. Contributions exceeding $250, whether cash or property, require written records of acknowledgement of receipt of the donation, including either an amount of cash or description of property. The receipt must also state if any benefits, such as admission or merchandise were provided in exchange for the donation. This donation proof can be combined into a single document.

When you deduct charitable expenses that aren’t cash donations, you’ll have to attach Form 8283, Noncash Charitable contributions, if your donation was greater than $500. If the donation is greater than $500 but less than $5,000, you’ll only have to fill out section A. If the property donated is greater than $5,000 you’ll be required to fill out section B and have a qualified appraisal completed. You’ll have to attach the appraisal to your tax return for any donation of property over $500,000 in value.

There are also special requirements for donation that appreciate in value, like investments or vehicles.