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Tips for End-of-the-Year Charitable Giving

thanksgiving dinnerThanksgiving was a time to reflect on all that we have, be grateful and enjoy family.  But as the calendar turns to December, we begin to think about which charities we are going to contribute to before the year’s end.

On November 17, the IRS released 6 suggestions to insure successful year-end charitable giving:

1. Qualified Charities. You can only deduct gifts you give to qualified charities.  Use the IRS Select Check tool to see if the group you give to is qualified. Remember that you can deduct donation you give to churches, synagogues, temples, mosques and government agencies and any other similarly qualified charity that maintains 501(c)3 status.  This is true even if Select Check does not list them in its database.

2. Monetary Donations. Gifts of money include those made in cash or by check, electronics fund transfer, credit card and payroll deduction. You must have a bank record or a written statement from the charity to deduct any gift of money on your tax return.  This is true regardless of the amount of the gift.  The statement must show the name of the charity and the date and the amount of the contribution.  Bank records include canceled checks, or bank, credit union and credit card statements.  If you give by payroll deduction, you should retain a pay stud, a Form W-2 statement or other document from your employer.  It must show the amount withheld for charity, along with the pledge card showing the name of the charity.

3. Household Goods. Household items include furniture, furnishings, electronics, appliances and linens.  If you donate clothing and household items to charity they generally must be in at least good used condition to claim a tax deduction.  If you claim a deduction of over $500 for an item it doesn’t have to meet this standard if you include a qualified appraisal of the item with your tax return.

4. Records Required. You must get an acknowledgement from a charity for each deductible donation (either money or property) of $250 or more.  Additional rules apply to the statement for gifts of that amount. This statement is in addition to the records required for deducting cash gifts.  However, one statement with all of the required information may meet both requirements.

5. Year-End Gifts. You can deduct contributions in the year you make them. If you charge your gift to a credit card before the end of the year it will count for 2014.  This is true even if you don’t pay the credit card bill until 2015.  Also, a check will count for 2014 as long as you mail it in 2014.

6. Special Rules. Special rules apply if you give a car, boat, or airplane to charity.  For more information, visit www.irs.gov.


ALWAYS check with your CPA tax advisor with any questions you have.

Source: www.irs.gov

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