Can I Use My Donated Clothes for My Tax Return?
Charitable contributions, including clothing donations, are deductible on your federal tax return. To receive this deduction on your taxes, however, you must itemize the deduction on Schedule A of your tax return. As of January 2011, non-monetary charitable contributions are limited to $500 per tax return, and obtaining receipts for your donations is advisable. The receipts are not filed with your annual tax return but are kept in your personal financial files.
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Clothing Appropriate for Resale
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Donated clothing is a charitable contribution that is deductible if you itemize on your annual tax return. Clothing donations include items that are in good condition and can be used or resold by charitable organizations. Damaged, severely worn or threadbare clothing is not acceptable as a tax deductible donation. Clothing and accessories including hats, scarves, shoes, jewelry, purses, athletic gear, coats and gloves are deductible as long as the items are available for immediate use and are appropriate for resale.
Total Resale Value Is Less Than $500
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The Internal Revenue Service (IRS) has guidelines pertaining to the value of donated clothing. Non-cash charitable contributions, including clothing, that exceeds $500 in value requires a receipt showing proof of the donation and the value of the items included. According to the IRS, you must complete Form 8283 and file it along with your tax return if the total value of your clothing donation exceeds $500 (as of January 2011). You do not need to include the receipt with your tax return. To determine the value of your clothing donation, consider the average price the item would sell for at a second-hand store or at a garage sale.
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Donated to a Recognized Nonprofit Organization
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All charitable clothing donations are made to qualified organizations and not to individuals in order to be deducted on your annual tax return. According to IRS regulations, if your contribution entitles you to goods or services, you can only take a deduction for the amount that goes above the fair market value of the item or service you received. Goodwill, Salvation Army and nonprofit thrift stores are examples of recognized nonprofit organizations that accept clothing donations.
Donated During Tax Year
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You can only deduct clothing donations using Schedule A on your tax return if the clothing was donated during the year that you are filing your taxes. You cannot include donations from previous years on your federal tax return. It is advisable to obtain a receipt for all non-cash clothing donations if you intend to itemize on your tax return. The dated receipts can be kept in your financial files in case you need to produce them for a tax auditor.
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