Do you know that many donations you make to the charity can be deducted from tax? That’s right, you can turn your household goods into a tax benefit that you no longer need. So, as you walk into the back of your closet, keep track of all the donated items. You ‘re responsible for reporting your donation to the IRS. All donated items must be in good condition or better in accordance with new taxation legislation. Previously, you could donate goods in fair condition, because you felt that something was worth it, but the new law requires that your items be questionable.
There are many computer applications available to help you determine the value of your donated items, although the traditional time – tested pen and paper method can be used. You will compile a list of your charitable goods and the value of each item in the goodwill box as you like. You do not have to send the list to the IRS, but you should keep it in a file with the remaining tax records. When you bring the items to the non – profit organization, make sure you receive a donation receipt. Although the receipt does not list the actual value of your donation, it can be used as evidence if you need it during a future audit. If the value of your non – cash donation falls between $ 250 and $ 500, you will need a written acknowledgement from the non – profit or charity. This is often the case with donations from vehicles, etc. If your donated property is over $ 500, you must complete Form 8283 in addition to your tax return.