To deduct charitable contributions you must file Form 1040 and itemize deduction on Schedule A.

To be deductible, charitable contributions must be made to qualified organizations. Qualified organizations include but are not limited to federal, state, and local governments and organizations organized and operated only for charitable, religious, educational, scientific, or literary purposes, or for the prevention of cruelty to children or animals. The organization can tell you if it is a qualified organization and if donations to it are deductible.

If you make a payment to a qualified charitable organization for a banquet, theatrical performance, or sporting event, you can deduct only the amount that exceeds the fair market value of the benefit received. You generally can deduct your cash contributions as well as the fair market value of any property you donate to qualified organizations. The fair market value of most household or personal items is generally much less than the price paid when new. You should claim only what the item would sell for at a garage sale, a flea market, or a second hand or thrift store. You must fill out Section A of Form 8283, Noncash Charitable Contributions, if your total deduction for all noncash contributions is more than $500. If you make a contribution of noncash property worth more than $5,000, generally an appraisal must be done. In that case, you must also fill out Section B of Form 8283. Attach Form 8283 to your return. For a contribution of $250 or more, you can claim a deduction only if you obtain a written acknowledgment from the qualified organization. For more information on this requirement, refer to Publication 526, Charitable Contributions.

Generally, if property you contribute increased in value while you owned it, you may not be able to deduct its full value. You must make an additional computation to determine the deductible amount of your contribution.

Contributions you can not deduct at all include; contributions made to specific individuals, political organizations and candidates, the value of your time or services and the cost of raffles, bingo, or other games of chance. You can not deduct contributions that you give to qualified organizations, if, as a result, you receive or expect to receive a financial or economic benefit equal the contribution.

Although you cannot deduct the value of your time or services, you can deduct the expenses you incur while donating your services to a qualified organization. If the expenses are for travel, which may include transportation and meals and lodging while away from home, they may be deducted only if there is no significant element of personal pleasure, recreation, or vacation in the travel. Actual costs of gas and oil can be deducted, or you can choose to take 12 cents a mile for using your own car.

If your total contributions for the year are 20% or less of your Adjusted Gross Income, your deduction is not limited. Contributions in excess of 20% may be limited depending upon the type of property or the type of organization the donation is contributed to.

For more information, refer to Publication 526, Charitable Contributions, and for information on determining value, refer to Publication 561, Determining the Value of Donated Property.

Tax Topics & FAQs | Tax Help Archives | Home