IRS Charity Donation Rules
When you donate money or goods to charity you can claim a deduction on your taxes. You must follow the rules laid down by the Internal Revenue Service on both the organization you donate to and the nature of your contribution, and you must also remember to keep good records.
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Qualified Organization
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Before making your donation you should be sure that you're giving to a properly registered charity that is a qualified 501(c)(3). You will also need to know the organization's tax ID number for your records before you file your taxes. You cannot deduct donations to political candidates or other individuals.
Donation
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Your gift to the charity must be a genuine donation and you may not receive any goods or services in return. If you are buying tickets to an event or a membership for example, organizations will often let you know that a portion of your payment exceeds the fair market value of the service, and you can deduct that excess amount. You may also deduct for donations of goods, and the IRS offers Publication 561, Determining the Value of Donated Property, so that you can itemize these correctly.
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Records
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You must keep paper records of all donations made in order to complete your tax return. This can be a bank record or a written confirmation from the charity. Any records must give the name of the organization and the date and amount of the donation. If you have given by text message, you may submit your phone bill as a legitimate record, as long as it shows the name of the charity you gave to, and the date and amount of the contribution.
Your Return
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When you are itemizing your charitable deductions, complete and file Form 1040 and itemize the deductions on Schedule A. If your total deductions for goods and noncash donations exceeds $500, you must fill in form 8283 and include this with your return. If you have donated something worth more than $5,000, you must complete Section B of this form, and you must also attach a professional appraisal.
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References
Resources
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