Documenting Charitable Contributions

Documenting Charitable Contributions

Charitable contributions of any amount are no longer deductible unless you have a proper receipt.  There have been recent court cases where the courts have disallowed significant deductions for charitable contributions where the taxpayers did not have a proper receipt. Since a receipt is required before taxpayers are allowed to take a deduction for the contribution, please review the flowing documentation requirements:

Contributions Made in Cash.  The law requires that you have a receipt, letter or other written communication from the charity showing the name of the charity, the date and the amount of the contribution to document all charitable contributions made in cash.  Please see additional requirements below if the contribution is $250 or more.

Contributions Made by Check, Debit Card or Credit CardFor charitable contributions made by check the law requires that you either have a receipt as outlined above for “contributions made in cash”, a copy of the cancelled check or some other bank record (e.g. a bank statement). For contributions made by debit card or by credit card, you are required to either have a receipt as outlined above for “contributions made in cash” or a bank record (e.g., a bank statement, credit card statement, etc.).  Please see additional requirements below if the contribution is $250 or more.

Contributions of $250 or More.  For all charitable contributions by individuals of $250 or more (contributions of cash, by check, by debit or credit card or of property), the law requires a receipt (written acknowledgement) from the charity to which you made the donation stating the date and amount of the contribution as well as a statement as to whether you received anything in return for your contribution. If you received goods or services in return for the contribution, the receipt must include a description and an estimate of the value of the goods or services received in return for the contribution.  If the goods or services received consist solely of intangible religious benefits, the receipt must include a statement to that effect (i.e., make sure your Church statements have this phrase or wording on them).  For the contribution to be allowable the written acknowledgement must be obtained and dated prior to the date you file your return for the taxable year in which the contribution was made (or if earlier, the due date, including extensions, for such return). Numerous tax court cases have disallowed charitable contributions (whether actually made or not) if the taxpayers did not have a proper written acknowledgement dated prior to filing their return, i.e. getting the written acknowledgement after the fact of filing your return is not acceptable written acknowledgement.

Contributions of Vehicles, Boats or Airplanes of more than $500.  If you are claiming a deduction of more than $500 for a vehicle, a boat or an airplane you contributed to charity, the law requires that you obtain a Form 1098-C or other written acknowledgement containing the same information as would be shown on a Form 1098-C from the charity in order to deduct your contribution.

Contributions of Clothing or Household Items.  Generally, a deduction is not allowed for a charitable contribution of clothing or household items unless the items are in good used condition or better.  Household items generally include furniture, furnishings, electronics, appliances, linens, and other similar items.  A written acknowledgement is required for the donation.  For clothing and household items, two good sources to assist you in valuing the fair market value of the donation is the Goodwill Thrift Store Valuation Guide or the Salvation Army Thrift Store Value Guide.

You can also use our Excel Spreadsheet to assist you with documenting you donations:

Click Here to Download Excel Spreadsheet - NonCash Donations

Written Acknowledgement Requirements:

  • The amount of cash and a description, but not the value, of any property other than cash contributed.
  • Whether the charitable organization provided any goods or services in consideration, in whole or in part, for any property contributed. 
  • A description and good-faith estimate of the value of any goods or services provided, or, if the provided goods and services consist of intangible religious benefits, a statement to that effect.

Separate payments are generally treated as separate contributions and will not be aggregated for purpose of applying the $250 threshold. In cases of contributions paid by withholding from wages, the deductions from each paycheck would be treated as separate payments.  However, the Treasury is to issue anti-abuse rules to prevent avoidance of the substantiation requirement by writing multiple checks on the same date.

IRS Website Lists Eligible Charities – You can do a search on the IRS website (http://www.irs.gov) to find out whether contributions to a particular organization are eligible for a charitable deduction.  Once at website, search “Exempt Organizations Select Check”.

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