Claiming tax deductions on gifts


Did you participate in #GivingTuesday? Or are you planning on make a donation before the end of the year? If so, here are five things to know about claiming a tax deduction on your donations.

  • Not every organization qualifies you for a tax deduction. Donations to churches and government agencies are deductible; to find out if other organizations are, you can contact them or use the IRS’s Select Check tool.
  • Cash donations, or donations made by check, electronic funds transfers, credit cards, and payroll deductions are all considered monetary donations. To deduct these donations, you must have a bank record (such as a canceled check) or a payroll record (a W-2 Form or a pay stub) where appropriate, or a written statement from the charity, regardless of the amount of the donation.
  • Household items such as furniture, furnishings, electronics, appliances and linens must be in good condition to claim a tax deduction. If you claim a deduction of over $500 for an item, it can be in less-than-good condition if you provide a qualified appraisal of the donation with your tax return.
  • For each deductible donation of $250 or more, you must have an acknowledgement from the charity; this is in addition to the records for deducting monetary donations. One statement with all of the required information can meet both requirements.
  • Lastly, you can claim charitable deductions in the year you make the donation. So, if you charge a donation to a credit card before the end of December, it will be considered a 2014 donation even if you don’t pay off the credit card balance until 2015. Similarly, if you make a donation via check this month, it will count for 2014 so as long as it is mailed before the end of the year, regardless of when the check clears.

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