A Reminder about Claiming Charitable Deductions
 

To be deductible, charitable contributions must be made to qualified organizations.  Payments to individuals are never deductible.

If your contribution entitles you to merchandise, goods, or services, including admission to a charity ball, banquet, theatrical performance, or sporting event, you can deduct only the amount that exceeds the fair market value of the benefit received.

For a contribution of cash or check (regardless of the amount), you must maintain a bank record or written communication from the qualified organization containing the name of the organization, the date and amount of the contribution.

For any contribution of $250 or more (cash or property), you must obtain a contemporaneous written acknowledgement from the qualified organization indicating the amount of the cash and a description of any property contributed.  The acknowledgement must state whether you were provided with goods or services in exchange for the gift, and if so, it must provide a description and good faith estimate of the value of such items. 

One document from the qualified organization may satisfy both the written communication requirement for monetary gifts and the contemporaneous written acknowledgement requirement for all contributions of $250 or more.
 

YOU MAY NOT KNOW THIS:
 

Out-of-pocket Expenses for Volunteer Services also require a written acknowledgment:

Out-of-pocket expenses of $250 or more incurred in connection with performing volunteer services for an organization are not deductible for federal income tax purposes unless you receive a written acknowledgment from the organization describing the volunteer services that were provided to the organization, and if you were provided with goods or services, a description and good faith estimate of the value of such items.

A standard letter given to the organization requesting   written acknowledgment of volunteer services can be used as recognition of your volunteer services, thus qualifying you to claim a charitable deduction.

There are also special rules for determining the value of donated property, for donations over $500, and for certain donations requiring an appraisal.
 

If you have questions or need further clarification, please don’t hesitate to call us at 208-265-5959.