Charitable Contributions, Charitable Deduction

Generally, you can deduct the market value of any property you donate, as well as your cash contributions. In order to deduct charitable contributions from your taxes you must itemize the deductions on form 1040, schedule A. Contributions must be made to qualified organizations in order to be considered a valid charitable deduction.

Qualifying institutions include:

• Religious organizations or places of worship such as, synagogues, churches, mosques, temples, etc.
• Federal, state, and local governments
• Recreation facilities and public parks
• Nonprofit schools and hospitals
• Groups for war veterans
• United Way, Boy Scouts, Girl Scouts, Boys and Girls Clubs of America, CARE, Red Cross, Salvation Army, etc.
• Organizations listed on Publication 78
• Any expenses incurred when serving with a qualified organization as a volunteer
• Expenses incurred for housing a student sponsored by a qualifying institution.

Non-qualifying institutions include:

• For profit institutions
• Individuals
• Lobbying groups
• Labor unions
• Chambers of comers
• Civic leagues
• Sports and social clubs
• Foreign organizations
• Homeowners’ associations
• Tuition
• Value of donated blood
• Political candidates or organizations.

Charitable cash contributions are not deductible unless you have written communication from the charity or bank record of the contribution.

You can only deduct the amount of a charitable donation that exceeds the market price of any compensation received for your charitable gift, whether it comes in the form of admission to a charity ball, merchandise, a theatrical performance, a sporting event, goods, etc.

If your contribution exceeds $250, you must acquire written acknowledgment from the qualified organization. You may use one written statement from an organization to satisfy the requirement written requirement for monetary gifts and property valued over $250.

If the your total deduction for noncash contributions exceed $500, you must fill out Form 8283 Section A. Generally, you will be required to obtain a third party appraisal if your contribution of noncash property exceeds $5,000. If that is the case, you will also have to fill out Form 8283 Section B.

You can only deduct up to 50% of your adjusted gross income in charitable contributions, and that figure may be as low as 20% or 30% based upon the type property that you donate and the organization that give it to.
If your contributions exceed the limits of your adjusted gross income, you may carry over the charitable deductions for a period of up to five years.

More details on charitable contributions

Disaster Relief

Have you been kind enough to provide housing in your primary residence for victims of hurricanes or the Midwestern disasters? If you provide housing for at least 6 consecutive months, you may be able to receive a tax credit of $500 per person, for up to four people, for a total credit of up to $2,000.

More details on housing disaster victims