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Charitable Giving: Donating Your Stuff
Posted By Miranda Marquit On 11/17/2011 @ 12:15 pm In Personal Finance,Philanthropy | 1 Comment
One of the ways you can help a worthy cause, and get a tax break, is to donate your goods. Many charities, such as thrift stores and shelters, accept donations of goods. You can even get a tax deduction for these goods. However, you do need to be careful. The IRS is picky about what you can donate, and the charities themselves are become choosier about what they will accept if you want to donate.
So, as you go through your closets and drawers, and before you clean out the attic or basement, think about the new standards of charitable giving when it comes to donating your goods:
Let’s be honest: In these tough economic times, the last thing a charity needs to do is haul your junk to the dump. In the past, even if they didn’t claim donated items on the tax return, some would bring items in poor condition to a charity. That saves money on the fees charged for disposal at the dump. Of course, the charity has to pay those fees — not to mention pay the gas costs for driving the items, and the cost of the hours spent sorting through your junk.
As a result of these increased costs, many charities are stepping up the way they vet donations. Additionally, many charities won’t come to your home to pick up larger items. You might be on your own when it comes bringing even the largest items to the charity’s location.
On top of that, realize that the IRS will only let you deduct your contributions of goods that are in “good” or “better” condition. “Fair” condition just doesn’t cut it if you want that tax deduction.
If you do want to donate goods to charity, and take the deduction, you need to keep good records. Get a receipt from the charity. The charity won’t actually put a dollar amount on the receipt, but it will list the items you donated. That way, you have a record that you actually made the donation. The IRS doesn’t need to see the receipt — unless you are audited.
Keep all of your receipts for goods with your copy of your tax return so that you have the records. The total amount of your donations belongs on Schedule A. Once your total non-cash donations reach $500, you will need to fill out a Form 8283 . You will also need to get a receipt for single item donations that have a value of between $250 and $500.
You can claim market value for your used items. This means that you claim your deduction for what the item is worth on the market — not what you paid for it. If you need some help adding up your non-cash donations, Bankrate offers a handy group of worksheets  that can help you estimate the value of some of the items you plan to donate. You can fill in the worksheets, and keep them with your personal records (no need to send them to the IRS unless you are asked to).
(Photo: osseous )
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 Form 8283: http://www.bankrate.com/finance/taxes/forms/tax-form-8283.aspx
 worksheets: http://www.bankrate.com/finance/money-guides/tax-guide-for-donated-goods.aspx
 osseous: http://www.flickr.com/photos/osseous/2286048828/
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