Valuing Non-Cash Donations

Valuing Non-Cash Donations

How to Value Non-Cash Contributions as a Deduction for Your Tax Return

Donations to a charitable organization of household items and used clothing in Good condition or better, may be valued and a deduction claimed for this donation on the itemized deductions section of your tax return (schedule A, form 8283).

The value should be “far less than the purchase price” according to the IRS publication 561. We recommend you start at a value of 25% of purchase price for items in excellent condition and proceed from their estimating what their selling price would be at a consignment shop.

TO DOCUMENT THE DONATION: You need to maintain a receipt from the charitable organization showing the date and items donated. Then you need to add the value of the donation that you’ve calculated based on the above procedure (fair market value at the date of donation).

INFORMATION WE NEED IN PREPARING YOUR TAX RETURN: We need a brief list of the items donated, name and address of the organization to which items were donated, date of the contribution and the value of the donation. We need this list for each donation date and organization.

For valuing other non-cash items, see methods for valuation in IRS publication 561 http://www.irs.gov/publications/p561/ar02.html#d0e556

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