Stephen Overton identifies tips for charitable donations. Please visit StephenOverton.org.

1. TIPS FOR CHARITABLE DONATIONS
5 INCOME
TAX
DEDUCTION
Stephen Overton

2. Good Documentation
When it comes to the IRS, documentation is
key. Keeping excellent records is essential to
proving that you gave exactly the amount you
claimed. Save any receipts, donation letters or
thank you cards from the organizations to
which you donated.

3. If you donated clothing and household items to
a charity shop, it is always a good idea to get
photo documentation as well as a receipt. This
can be used to confirm the value of your
donation if the need ever arises.

4. Don’t Overlook Less Obvious Donations
When it comes to tax deductions, every dollar
counts. Do not lose out on these deductions by
neglecting to itemize the less obvious
donations you make each year. When the
cashier at the grocery store asks you to donate
to their charity drive, save the receipt for a
write off.

5. When you donate your time to a charity, the
time you spend is not deductible but any travel
expenses you incur count toward your
donations. You can also deduct any recurring
donations you make from your paycheck or
subscription donations from eligible charities.

6. Large Charitable Donations Require More
Documentation
When you donate small value items or little
sums of cash, receipts will suffice for proving
the donation. When it comes to larger
donations, be aware that they will come under
more scrutiny and may require additional
documentation.

7. When a donation is above 250 dollars, the IRS
requires detailed descriptions in addition to
receipts, letters of acceptance and any relevant
bank statements. A property donation of 5,000
dollars or more needs an appraisal completed
by a professional.

8. Verify an Organization’s Tax Exempt Status
A costly mistake that taxpayers often make is
contributing their cash or property to
organizations that have not obtained tax
exempt status. The IRS maintains a list of
approved charities that are able to accept
deductible donations.

9. A charitable organization not on this list may
accept donations, but you will be unable to
legitimately itemize them on your taxes. Before
you make a large contribution, ask to see their
certification letter from the IRS. Of course you
may still choose to donate to charities that do
not retain tax exempt status, but be aware that
they will not count toward your deductions.

10. Deduct the Value of Donation Gifts
Many charitable organizations will offer a gift
as incentive for contributing cash. Taxpayers
often overlook the need to deduct the value of
the gift from the total donation. For example, if
you make a small donation to your local public
radio station, you must deduct the value of the
branded tote bag you receive.

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