Tax Deductions For Donations: 5 Tips You Need To Know

Most gracious givers don't perform altruistic acts completely selflessly. Charitable tax deductions can be a big plus come tax season, and we've compiled top tips you need to know.

Above all, in order to be deductible, your donation must have been made to a qualified organization. Make sure the receiving organization is qualified by checking the IRS site, calling the IRS at 1-877-829-5500 or simply asking the organization.

If you have yet to file, check out these last-minute charitable tax deduction tips you may not be aware of.

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• Donations over $250

  For donations over $250, you must have documentation from the charity when you file, <a href="http://www.smartmoney.com/taxes/income/the-tax-perks-of-charitable-giving-11097/" target="_hplink">according to SmartMoney.com</a>. If the donation was in cash, the amount should be noted. If the donation was specific items, the organization must provide a description but does not have to value it.

• Text donations

  For text message donations, a telephone bill meets the record-keeping requirement if it shows the name of the recipient, date and amount given, <a href="http://www.irs.gov/newsroom/article/0,,id=106990,00.html" target="_hplink">according to the IRS</a>.

• Car donations

  The write-off for your donated vehicle depends on how the organization uses it. When you donate, the IRS gets a copy and checks car donation specifics closely, <a href="http://www.smartmoney.com/taxes/income/the-tax-perks-of-charitable-giving-11097/" target="_hplink">according to SmartMoney.com</a>.

• Donations You Can't Deduct

  You can't deduct contributions made to specific individuals, political organizations and candidates, <a href="http://www.irs.gov/newsroom/article/0,,id=106990,00.html" target="_hplink">according to the IRS</a>. If you received something such as show tickets because of your contribution, then you can only deduct the amount that exceeds the fair market value (generally agreed upon selling price) of the item, <a href="http://www.irs.gov/newsroom/article/0,,id=106990,00.html." target="_hplink">according to the IRS</a>.

• Surprising Deductions

  If you hosted an exchange students last year, you can deduct up to $50 per month for each month the students stayed with you, <a href="http://finance.yahoo.com/news/charitable-donations--what-you-need-to-know.html" target="_hplink">according to Yahoo! Finance</a>. In fact, if you hosted the students for 15 or more days, that counts as a full month. If your student was enrolled as a full-time student at a U.S. school, was placed in your home through a qualified organization, and is not your relative, go ahead and deduct. Volunteer work does not yield a deduction, but transportation to and from the event, however, can mean a deduction, <a href="http://www.irs.gov/newsroom/article/0,,id=106990,00.html" target="_hplink">according to the IRS</a>.

Comments

[Warren Barrington]

03:04 PM on 07/24/2012

I have always loved Cardonationwizard.com They are very fast and courteous. They work with the best charities out there and make the process as smooth as possible. I highly recommend them. They are the best in the business!

[WithCauses]

05:05 PM on 06/14/2012

A great place for car donations California is www.OnlineCarDonation.org. As stated in a previous comment, every year I go through EVERYTHING that I own, and donate the majority of what I don't use anymore. I had an old car that had been sitting in my backyard for years, I didn't want to junk it, so I heard that www.WorksOfLife.org accepts cars in non-running condition. I never knew this, so I called them to verify and they said that they did!

It was very easy and quick!