Food Donation Tax Deductions

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The federal government encourages taxpayers to make food donations to the needy by offering a deduction for the cost of the donated food. However, as good as your intentions may be, the IRS still requires you to satisfy certain criteria before you are eligible to claim the deduction.

IRS Charities

  • Before making any food donation ensure the charity you donate to is an IRS qualified organization. This requires the organization to obtain official tax-exempt status from the IRS, unless it's a religious organization such as a church or synagogue. Generally, the IRS offers tax-exempt status to organizations whose sole missions are to promote charitable, religious, humanitarian, educational, scientific or literary causes. So if you donate the food to a local homeless shelter, chances are that it's a qualified organization. However, if you are counting on claiming the charitable contribution deduction, you should ask a representative from the organization.

Donating Food

  • Since you are not donating cash to a charity, the IRS requires you to determine the value of the food. The value you estimate for the food will equal the deduction you take as long as it is a reasonable valuation. In most cases, the easiest way to determine value is using the price you pay to purchase the food. If you are preparing meals to donate, you can include the cost of all ingredients, but don't include any value for the time you take preparing the meals.

Claiming Donation Deductions

  • If all other requirements are met, your food donations will qualify for a charitable contribution deduction, which you can only take as an itemized deduction on Schedule A. However, not every taxpayer itemizes; some claim the standard deduction instead. If you do claim the standard deduction because the total of your food donations plus all other deductible expenses are less than the standard deduction, then you cannot save any additional income tax with your food donation.

Donations of Food Inventory

  • Many businesses, such as restaurants and hotels, regularly donate their excess food inventory to local charities. When you own the business that is making the food inventory donations, you are subject to different requirements before you can deduct the cost of the food from your business earnings. First, the food you donate must be suitable for human consumption, meaning you cannot claim a deduction for donations of spoiled food. In addition, the charity you donate the food to must use it to feed the needy, ill or the elderly and is prohibited from selling it. When you make this type of food donation, the IRS requires you to obtain a written statement from the organization confirming that it will only use the food for these purposes.

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