Giving is a reward in itself, but being able to deduct your charitable contribution come tax season is an undeniable perk as well.
However, you have to follow the IRS rules and regulations carefully when you deduct your charitable contributions. Here are some to tips straight from the IRS.
1. Qualified Organization: Make sure the organization you've donated to is a qualified organization. (Search here.)
2. Schedule A : You must file Form 1040 and itemize your charitable contributions on Schedule A.
3. Donation Gifts: Sometimes you'll receive gifts because of your charitable contribution, like tickets to a football game. If you do, you can only deduct the amount that exceed the fair market value of the benefit received.
4. Use the Fair Market Value Donations of stock or other non-cash property are usually valued at the fair market value of the property. Clothing and household items must generally be in good used condition or better to be deductible.
5. Get the Proof Regardless of the amount, to deduct a contribution of cash, check, or other monetary gift, you must maintain a bank record, payroll deduction records or a written communication from the organization. It should have the name of the organization, date you made the contribution, and the amount you donated.
Final Tip: In order to claim a deduction for the contributions you claim, the cash or property should equal $250 or more. Again, make sure you have a bank record, payroll deduction records, or written acknowledgment from the qualified organization before you claim the deduction!
