Individual Tax

Tax Planning & Compliance
Estates, Gifts & Trusts
Charitable Giving
Wealth Management
IRS Controversy Representation

Charitable Giving

Charitable contributions paid to qualified organizations may help reduce individual tax liability. The following 7 tips guided by the IRS to ensure your contributions pay off on your tax return.

• Contributions must be giving to a qualified organization instead of specific individuals, political organizations or candidates.
  
• Charitable contributions are deductible only if you itemize deductions on  Form 1040, Schedule A
• If you receive a benefit because of your contribution such as merchandise, tickets to a ball game or other goods and services, then you can deduct only the amount that exceeds the fair market value (FMV) of the benefit received. FMV is defined as the price at which property would change hands between a willing buyer and a willing seller, neither having to buy or sell, and both having reasonable knowledge of all the relevant facts.
• Donations of stock or other non-cash property are usually valued at the fair market value of the property. Clothing and household items must generally be in good used condition or better to be deductible. Special rules apply to vehicle donations.
• Regardless of the amount, to deduct a contribution of cash, check, or other monetary gift, you must maintain a bank record, payroll deduction records or a written communication from the organization containing the name of the organization, the date of the contribution and amount of the contribution. For text message donations, a telephone bill will meet the record-keeping requirement if it shows the name of the receiving organization, the date of the contribution, and the amount given.
• If your total deduction for all noncash contributions for the year is over $500, you must complete and attach IRS Form 8283, Noncash Charitable Contributions, to your return.
•  Taxpayers donating an item or a group of similar items valued at more than $5,000 must also complete Section B of Form 8283, which generally requires an appraisal by a qualified appraiser.